New Jersey: Offshore Wind Economically Non-Viable

An update to New Jersey’s Energy Master Plan has shown a non-enthusiastic and careful approach to offshore wind, referring to it as not being economically viable at this time. 

On 20 November, the New Jersey Board of Public Utilities (BPU) and the New Jersey Department of Environmental Protection released a draft update to the 2011 New Jersey Energy Master Plan for public comment. The update measures the progress made toward meeting the goals set in the 2011 Energy Master Plan and makes recommendations for building on that progress. 

The goal for offshore wind energy set out in 2011 said the state will examine the viability of developing offshore wind generation subsidized by the Offshore Wind Renewable Energy Certificate (OREC) program. OREC provides an application process and a framework under which the BPU will review any application. The rules were amended in 2013, and the BPU said it is working on further refinements to the rules.

In the latest update, the BPU said: “While offshore wind may become a valuable energy resource, generating energy through offshore wind carries significant drawbacks.” Construction, operation, and maintenance of an offshore wind project at this point would be too costly due to technological challenges, according to the document.

“While the future may bring change, offshore wind in the U.S. is not economically viable at this time,” the update said.

“Although offshore wind projects have not yet proven economically feasible in New Jersey, BPU remains interested in examining the potential for offshore wind projects to become part of the State’s energy portfolio, provided that the projects are economically viable and that New Jersey ratepayers and businesses are protected.”

The BPU also said it will actively monitor the development of the recently awarded lease areas. At the beginning of November, the U.S. Bureau of Ocean Energy Management (BOEM) announced RES America Developments Inc. and US Wind Inc. as the provisional winners of the auction for two New Jersey offshore wind lease areas.

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