The New Jersey Board of Public Utilities has again rejected Fishermen’s Energy of New Jersey LLC’s proposal to build a 25-MW offshore wind farm off the coast of Atlantic City, finding that too much financial uncertainty remains around the project.
The BPU first rejected the project in March, but the developer and its supporters had hoped that a $47 million grant awarded by the U.S. Department of Energy after that rejection would change the result.
It did not.
In a Nov. 21 order, the BPU said it was reaffirming its March decision, finding that Fishermen’s Energy had not demonstrated receipt of $100 million in federal subsidies it considered necessary for the project, had not adequately demonstrated the project’s viability without those subsidies and that the BPU’s financial analysis of the project had not materially changed.
“Without receipt of the full federal subsidies, this project does not pass [the full ‘net economic benefit’] threshold and thus may not be deemed eligible to receive [offshore wind renewable energy certificates] per the requirements of [Offshore Wind Economic Development Act],” the board found.
The board said that even though the project had been awarded the DOE grant, the actual receipt of the grant was still contingent on the board’s approval of the project by June 30, 2015, and that the DOE retains the authority to make a “go/no-go” review based on the project’s ability to meet certain milestones.
Further the board expressed skepticism that the project would either be able to obtain additional support from the currently expired investment tax credit or be able to adequately finance the project without it.
“[Fishermen’s Energy Atlantic City Windfarm] now asserts that the project is viable at an OREC price of $199.17, even if only one-half of the approximately $100 million in federal subsidies is received, and that it would accept a lower rate of return if the ITC is not authorized,” the board wrote. “Other than FACW’s assertions that the $199.17 OREC price makes the project viable, the record contains no evidence to substantiate FACW’s contention that the $199.17 OREC price is realizable without the full receipt of the subsidies.”
As a result of its findings, the BPU said it was reaffirming its decision that the project “does not provide a net economic and environmental benefit to New Jersey ratepayers.”
In a statement released shortly after the decision, the Sierra Club of New Jersey said that New Jersey Gov. Chris Christie’s administration had failed to fully implement the states offshore wind policy.
“Until there are rules in place, offshore wind in New Jersey will not be a reality and we will miss out on the jobs and economic growth that comes with investing in offshore wind,” New Jersey Sierra Club Director Jeff Tittel said.
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