At the end of June, the Cape Wind project received federal approval much to the dismay of vocal opponents. This will be the first off-shore wind project in the U.S. and will consist of 130 wind turbines and the project is expected to be complete in 2012. While the debate was raging on around Cape Wind, several other states were moving forward with developing off-shore wind projects of their own including New Jersey, Road Island and Maine.
Two months after Cape Wind was federally approved, New Jersey passed the Offshore Wind Economic Development Act. This act was designed to create financial incentives for offshore wind development and sets a target of 1,100 megawatts of wind generation. This goal ties into the state’s Renewable Portfolio Standard which sets targets for renewable energy including solar and wind. The act authorizes the New Jersey Board of Public Utilities (BPU) to set financial regulations and oversee applications for new projects and also requires suppliers of electricity to retail customers to hold an Offshore Wind Renewable Energy Certificate (OREC).
In addition to the creation of the ORECs, the act created a 100 percent tax credit for capital investments of $50 million-$100 million in new offshore wind facilities. In addition, the act will work in tandem with the Economic Development Authority to allocate money from the Global Warming Solutions Fund to support these projects and provide assistance to the manufacturers of offshore wind equipment.
While the act may seem somewhat cumbersome, here is what it boils down to. BPU has already provided $4 million to a developer who is looking to build a 346-megawatt project 16 miles off the southern coast of New Jersey. In addition, BPU has approved a 20-25 megawatt project three miles of the coast of Atlantic City. Should either of these projects see fruition before Cape Cod, New Jersey will take the title of the first completed offshore wind project.
However, what may be more important than who is first, is the support that offshore wind is receiving on the East Coast. The Atlantic Offshore Wind Energy Consortium was recently established by 10 states to promote the development of offshore wind projects. When you combine all of this activity it appears that offshore wind development has great momentum. Let’s hope that this momentum is not stymied by difficult and drawn out permitting processes.