New Jersey Plans to Restart Offshore Wind in 2024 After “Bump in the Road”
The Governor of New Jersey is looking to restart his state’s offshore wind programs reiterating that they remain committed to offshore wind as a key component of the state’s renewable energy program. The state said the governor’s action reaffirmed its overall commitment to achieving 100 percent clean energy by 2035 and developing the economy by building the industry and its supporting supply chain.
The New Jersey Board of Public Utilities (NJBPU) was directed by the governor to accelerate the timeline of the state’s fourth offshore wind solicitation. Originally scheduled for the summer of 2024, Governor Phil Murphy on November 29 directed NJBPU to launch the next offshore wind solicitation in early 2024. However, the state does not expect to announce the awards in early 2025 for projects that will not be operational till 2032.
“I have directed the BPU to take this action in recognition of the strong future of New Jersey’s offshore wind industry,” said Governor Murphy. “New Jersey can – and will – continue to remain a burgeoning offshore wind development hub that attracts new projects and their accompanying economic and environmental benefits for generations to come.”
Speaking on a local TV news station at the beginning of the week, the Governor described Ørsted’s cancelation of the Ocean Wind 1 and Ocean Wind 2 projects as “a bump in the road.” Ocean Wind 1, which was to have been the largest wind farm in the United States with 1.1 GW of power, had received federal approval in July 2023 and was due to begin construction with power starting in 2025 and completion in 2026. It was to have been followed by an equally large second phase, which together were billed as the hallmark of the state’s renewable energy program. Ørsted canceled both projects at the end of October citing rising costs and development problems.
The cancelation sets back New Jersey with its first large offshore wind farm now likely to be Atlantic Shores, a partnership between Shell New Energies US and EDF Renewables. It calls for a 1.5 GW project off the coast of Atlantic City but is not expected to be online until 2027 and 2028.
New Jersey hopes to solicit at least 1.2 GW of power in the next round, but the governor did not set a specific start date. Also, the state has not discussed if, like New York and Rhode Island, it would be adapting the structure of the bids to address the financial and supply concerns that emerged and are currently derailing large wind farm projects both in the United States and Europe.
State officials highlight that the industry is moving forward despite the well-publicized challenges. Last week, the Bureau of Ocean Energy Management approved another large wind farm, Empire Wind, which will be built off New Jersey but the power will be sold to New York. The first commercial-scale U.S. offshore wind farm, South Fork in New York is days away from first power, and a large project is also erecting its wind turbines off Massachusetts. Dominion Energy also received approval and is starting its large project off Virginia.
New Jersey highlights that it received strong interest in its third solicitation completed in June. It is expected to announce the results by the start of 2024 with as many as four projects proposed. The state outlined a plan for a total of seven solicitations which started in 2018 and calls for four more rounds with bids in 2024, 2026, 2028, and 2030. Governor Murphy’s goal is for 11 GW of offshore wind energy in New Jersey by 2040, which could power 3.2 million homes with renewable energy.