The New Jersey Board of Public Utilities’ second solicitation for offshore wind power, announced in September, was no casual bureaucratic pronouncement. Activities such as these generate the demand for offshore wind power, and incentivize companies to invest in that industry.
The first NJBPU solicitation for offshore wind power, awarded in 2019, went to Ørsted Wind Power North America, part of a global leader in offshore wind based in Denmark. The application process for NJBPU’s second solicitation, which will award between 1200 and 2400 megawatts, will be ongoing through mid-December, and is expected to be awarded in June 2021.
Solicitations like these “create a pipeline of demand for these types of projects,” said Brian Sabina, a senior vice president at the New Jersey Economic Development Authority. “They serve as an anchor to solidify growth of this industry in New Jersey.”
The state “has one of largest wind generation pipelines on the East Coast,” he added. “It is as large as many European countries right now.”
These NJBPU solicitations are the latest in a chain of events that dates back to 2010, when New Jersey enacted the Offshore Wind Economic Development Act (OWEDA). That legislation required that a percentage of electricity sold by New Jersey suppliers come from offshore wind, and provided $100 million in tax credits for businesses related to the wind energy supply chain.
In 2015, the Federal Bureau of Ocean Energy Management (BOEM) auctioned off leases for two wind energy areas offshore New Jersey. The winners of the leases were U.S. Wind Inc., which has since transferred its lease to EDF Renewables Development, Inc., and RES America Developments Inc., which transferred its stake to Ocean Wind, LLC, a subsidiary of Ørsted. Ørsted and EDF Renewables are currently working through the BOEM process, which includes geological surveys and an environmental review.
In April 2017, New Jersey Governor Phil Murphy—then running for office—promised to target construction of 3.5 gigawatts of offshore wind energy capacity by 2030—enough to power 1.5 million New Jersey homes, part of a broader strategy to achieve 100% clean energy by 2050. In January 2018, Murphy signed an executive order directing relevant state agencies to formulate the processes required to realize those goals.
Sabina anticipates that NJBPU will be awarding solicitations for wind power “every couple of years,” which will assure industry stakeholders, including port developers, that “this is not a flash in the pan, but that there is consistency to the business. They can then turn around and build it up.”
It will likely take six to seven years from the time a NJBPU solicitation is awarded until a wind farm comes online. That would put the first wind farm offshore New Jersey to become operational in late 2023 or early 2024.
The wind energy supply chain represents an economic development engine that is expected to create thousands of jobs in operations, maintenance, manufacturing, and logistics. “We think this is a great opportunity for new business and economic growth for South Jersey,” said Andy Saporito, Executive Director and CEO of the South Jersey Port Corporation. “It will also mean more maritime activity on the Delaware River.”
