newjerseynewsroom.com

BY ADELE SAMMARCO

NEWJERSEYNEWSROOM.COM

Governor Christie signed the Offshore Wind Economic Development Act as a sign of his commitment to expand New Jersey's economy by promoting alternative energy initiatives key to the State's technological future.

The bipartisan measure was introduced in 2010 to spur economic growth in the Garden State through the development of renewable energy resources and the creation of green jobs.

A year later, one of a handful of companies bidding to develop a wind farm off the coast has divulged it is pulling the plug on the project.

On Monday, NRG Energy announced it will terminate an agreement to build a 200-megawatt wind farm off the coast of Delaware and will put its subsidiary, NRG Bluewater Wind, up for sale and not proceed with its proposal to build a wind farm off the Jersey coast.

According to a press release put out by the Princeton-based energy company, NRG acknowledges monumental challenges in developing a new domestic industry, but will put active development of offshore wind projects on hold for the near term.

NRG cites subsidiary and lead developer of the Mid-Atlantic Wind Park (the Wind Park) off the coast of Delaware, Bluewater Wind, as having been unable to find an investment partner and intends to terminate the project’s 200-megawatt power purchase agreement (PPA) with the Delmarva Power & Light Company (DP&L) at the end of the year.

Peter Mandelstam, President of NRB Bluewater, says the move was based on an array of factors. According to NJSpotlight.com, Mandelstam pointed out uncertainty about continued government support from federal tax credits and federal production credits, which are due to expire at the end of 2012, as well as a decision by Congress to eliminate funding for a U.S. Department of Energy loan guarantee program for offshore wind.

Despite the pull-out, two other energy groups are vowing to move forward with their plans. Fishermen’s Energy, LLC of Cape May hopes to begin the first phase of its project to build offshore wind turbines a few miles off of Atlantic City in 2013 and the Newark-based Garden State Offshore Energy, LLC, a joint venture between PSEG Global and Deepwater Wind says it will continue “to move cautiously forward’’ with its proposal.

Local environmental groups have been strong proponents of off-shore wind energy for years.

Jeff Tittel, Director of the New Jersey Sierra Club, told NJSpotlight, “Everything is caught up in a regulatory morass. It’s a clear signal that state and federal authorities are not moving fast enough.’’

Offshore wind developers have been fervently lobbying to have both state and federal governments expedite rules and permits to support offshore wind.

However, Mandelstam does not believe the state process was a factor in NRG’s decision to drop-out citing the process still needs a lot of work, but it is trending in the right direction. He adds, “A bigger concern is establishing regulatory certainty, a factor Europe has been able to achieve and the U.S. has not.”

The Offshore Wind Economic Development Act was created to establish an offshore wind renewable energy certificate program (OREC) in order to make available financial assistance and tax credits from existing programs for businesses that construct manufacturing, assemblage and water access facilities to support the development of qualified offshore wind projects.

In the meantime, some offshore wind developers have been frustrated with the state Board of Public Utilities claiming it has yet to set a timeframe for adopting a rule that would allow them to obtain OREC’s for the electricity their wind farms generate. Modeled on a similar system used to promote solar power in New Jersey, the wind certificates would be purchased by electricity suppliers and then paid off by ratepayers.