Ocean Wind, a partnership of Orsted and PSEG, selected as sole developer of 1,100 MW wind farm.
The New Jersey Board of Public Utilities formally voted to award Ocean Wind as the sole developer of New Jersey’s first offshore wind farm, that will power nearly half a million New Jersey homes. The action today marks the most significant action to develop offshore wind since the enactment of the Offshore Wind Economic Development Act in 2010 and was a major initiative of Gov. Phil Murphy. Governor Murphy signed Executive Order No. 8 in the early days of his administration to promote wind development. This award is the first of three expected offshore wind solicitations totaling at least 3,300 MW, which is the goal set in EO No. 8.
The BPU solicited bids to build all or part of the 1,100 first round. Three companies submitted proposals, Ocean Wind, Atlantic Shores, and Boardwalk Wind. Those bids consisted of 14 different solicitations ranging from 400 MW to the full 1,100 MW solicitation.
The evaluation criteria looked at the OREC price, ratepayer impacts, environmental impacts, economic impacts, the strength of the guarantees of economic impacts, and the likelihood of success. All bids were required to show a positive net benefit.
The BPU’s staff and consultants reviewed the solicitations and determined four different options met the approval criteria. The BPU members ultimately believed that Ocean Wind submitted the strongest proposal for the entire solicitation. Despite this first award, the BPU specifically is welcoming other companies to participate in the next two solicitation rounds.
According to Offshore Wind Journal, the winning bid will result in ratepayer impacts as follows:
Ørsted’s Ocean Wind project offered a first year offshore renewable energy credit (OREC) price of US$98.10/MWh. The levelized net OREC cost – which represents the actual OREC costs paid by ratepayers after energy and capacity revenues are refunded to ratepayers – is estimated at US$46.46/MWh, with an estimated ratepayer impact of a monthly bill increase of US$1.46 for residential, US$13.05 for commercial, and US$110.10 for industrial customers.
NJBIA will continue to be involved in future NJBPU offshore wind solicitations and looks forward to working with Ocean Wind as it becomes an integral part of the New Jersey business community.