trending Market Intelligence /marketintelligence/en/news-insights/trending/dgmkhhrwheposqekbnutmq2 content esgSubNav
Log in to other products


Looking for more?

Contact Us
In This List

NJ eyes stimulus to revive offshore wind industry


Highlighting the Top Regional Aftermarket Research Brokers by Sector Coverage


COVID-19 Impact & Recovery: Energy Outlook for H2 2021


Corporate renewables market flourished in 2020 despite pandemic


Corporate Credit Risk Trends in Developing Markets: A Loss Given Default (LGD) Perspective

NJ eyes stimulus to revive offshore wind industry

Attempting to jump-start the state's offshore wind industry, the New Jersey Board of Public Utilities is seeking public comment through Oct. 19 on draft rules to create a program to stimulate the development of offshore wind farms.

The rules, released by the BPU on Aug. 10, would create an incentive program based on offshore wind renewable energy credits, or ORECs. A BPU order from July 25 approved the funding mechanism as part of a broad effort in New Jersey to revive the offshore wind sector, which faced permitting challenges under Republican Gov. Chris Christie.

Those challenges have delayed the emergence of the offshore wind industry in New Jersey even as other East Coast states, such as Maryland and Massachusetts, have moved aggressively to support wind farms off their coasts.

Democratic Gov. Phil Murphy, who took office in January, signed an executive order later that month to establish a goal of 3,500 MW of offshore wind by 2030 and directed the board to implement rules to fund a stimulus program. The executive order also called for the BPU to issue a solicitation for the first 1,100 MW of offshore wind, a target set by a 2010 law but not yet achieved.

Under the draft rules, offshore wind projects can apply to the BPU to earn credits equivalent to the cost of building and operating a project for 20 years. Electric suppliers can buy the credits to comply with annual renewable requirements under the state's renewable portfolio standard. The BPU can specify what portion of the annual renewable requirement comes from offshore wind, according to the rules.

Under the program, the state's electric distribution companies would serve as "payment agents" to facilitate the exchange of ORECs between project developers and electric suppliers. The distributors would make monthly payments to qualified projects, and could apply a surcharge to customer bills to fund the ORECs. Any revenues from ORECs would be refunded to ratepayers.

To be eligible for ORECs, projects have to show they have a net economic benefit to the state. The board's staff expects the costs of the ORECs to be offset by new job creation and increased business for suppliers to the sector.

Offshore wind qualifies under the state's RPS as a Class I renewable, a category that also includes solar, geothermal, biomass, small hydro, municipal solid waste, energy storage and other types of renewable energy. Murphy in 2018 adopted a clean energy law that requires half of the state's power sales by 2030 to come from Class I renewables.