NJ’s First Off-Shore Wind Project Gets Final Regulatory Approval
While developers and investors were celebrating the boost to the solar energy business when Governor Christie signed S-1925 into law on July 24, 2012, increasing the state’s solar requirements, the off-shore wind sector received a boost when the US Army Corps of Engineers approved the Individual Permit under the Clean Water Act for Fishermen’s Atlantic City Windfarm. This is the final permit needed in order for Fishermen’s Energy to begin construction of the demonstration project.
The demonstration project will be built 2.8 miles from the Atlantic City boardwalk and the turbines could generate up to 25 megawatts, powering 10,000 homes.
There are eleven other companies interested in building wind farms off the coast of New Jersey. The success of the nacent industry, however, may depend on the availability of financing and incentives.
Recently, an “ill wind” blew into the market as fears that energy funds would be swept into the state’s general fund to close budget gaps increased. New Jersey Board of Public Utilities President, Bob Hanna, said the state recognizes the problem with the potential diversion of off-shore wind money and is trying to resolve the issue, hopefully by sometime this Fall. Financing is a key issue, since construction could cost more that $1 billion.
Fishermen’s Energy still faces the possible opposition of New Jersey’s Division of Rate Counsel, which, in February 2012 argued the project failed to deliver a net economic benefit. A report prepared by consultants retained by the Board of Public Utilities (BPU) also concluded that the proposed wind farm failed to justify the economic benefits of moving forward. Since Fishermen’s Energy is seeking ratepayer subsidies from the BPU as a main source of financing, these negative reports were a challenge. Subsequently, Fishermen’s Energy submitted a new application, currently under review by the Division of Rate Counsel. A decision by the BPU is expected by the end of the year.
In short, while the sun appears to be shining on the solar energy sector, off-shore wind seems to have fallen into the doldrums.