New Jersey Selects 3.7 GW of New Offshore Wind Projects, Awards Inflation-Adjusted OREC Contracts

Planning & Permitting

January 25, 2024, by Adrijana Buljan

The New Jersey Board of Public Utilities (BPU) has selected two new offshore wind projects totalling 3,742 MW in generation capacity that will be awarded 20-year Offshore Renewable Energy Credit (OREC) contracts.

In its third offshore wind solicitation, New Jersey has selected Leading Light Wind (2,400 MW), developed by Invenergy and energyRE, and Attentive Energy Two (1,342 MW), developed by a joint venture between TotalEnergies and Corio Generation.

According to the New Jersey BPU, the total bill impact of the two projects for residential customers will be USD 6.84 per month. This will be in effect only once the offshore wind farms are fully operational.

In a press release announcing the award of the 20-year contract in New Jersey, TotalEnergies noted that there was a guaranteed level of OREC revenue, with a first-year set price of USD 131/MWh after the start of commercial operations, inflated yearly by 3 per cent, and the benefit of a 30 per cent Inflation Reduction Act (IRA) tax credit.

“The contract awarded by the NJBPU also includes a one-time inflation adjustment mechanism to compensate for changes in construction costs environment until the final investment decision,” TotalEnergies states.

The New Jersey BPU emphasised that both projects have committed to supporting the establishment of a tower manufacturer at the New Jersey Wind Port, in addition to sourcing monopiles from the EEW monopile facility at the Port of Paulsboro.

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The two projects are estimated to create more than 27,000 direct, indirect, and induced full-time equivalent job years, and have also committed to provide support for environmental and fisheries research, monitoring, and conservation efforts in an amount totalling over USD 60 million, according to the New Jersey BPU.

The BPU is also expected to soon open the fourth offshore wind solicitation after the New Jersey Governor recently directed the authority to launch the fourth offshore wind solicitation in early 2024.

The fourth offshore wind solicitation was planned to commence in the third quarter of 2024, but with the bidding period now expected to open earlier this year, OREC contract awards are also expected to be announced in early 2025.