TRENTON – The decision on a proposal for an offshore wind energy project was put off Friday by the Board of Public Utilities. Instead, the board approved staff recommendations opposing a proposed settlement between the parties in the case.
The Fishermen’s Energy Atlantic City wind farm proposal seeks to build six wind turbines capable of 25 megawatts.
Advocates hail it as an opportunity to get New Jersey finally off the ground in an area they say it lags behind other states.
However, opponents said the estimated cost to customers earlier this year of $200 million to subsidize the pilot project is too much and too risky.
But Fishermen’s CEO Chris Wissemann has said in the past that the project also will mean jobs, because a wind turbine manufacturing plant would be built in Paulsboro.
XEMC, a China-based wind turbine manufacturer, has said in the past that it would build such an operation, but that is tied to the BPU approval, Fishermen’s has said.
Rate Counsel and Fishermen’s had reached a proposed settlement over their differences, but BPU staff objected to them in part today.
They said it does not pass a cost-benefit test, because for one thing, the ratepayers would be burdened with $19.2 million if the project does not succeed.
On another matter, Fishermens proposed a construction escrow fund of $61 million but staff wants at least $121 million, the BPU was told.
Board President Robert Hanna said he was encouraged progress had been made by the parties, including allowing an additional 10 days for more documents or submissions. He said staff should ensure that none of the parties wants to have a hearing; if they want one, he would conduct it as soon as possible.
Commissioner Jeanne Fox said that this is a new arena for the state and the country. She was concerned about the financial integrity of Fishermen’s moving forward.
She wanted to see wind move ahead but the ratepayers shouldn’t be burdened with the risk.
Commissioner Joseph Fiordaliso said he supported wind energy as one of the pieces to the overall energy puzzle. “We are moving as expeditiously as we can,’’ he said, but added the ratepayer has to be protected to the strongest extent possible.
He said he also was concerned about a demonstrated lack of financial integrity.
“The projects have to show net positive benefits,’’ such as in more jobs, in order to offset costs, Hanna said.
Wissemann said that Fishermen’s proposal would inject $150 million into the state’s economy.
He said part of the problem is that seven entities, including Fishermen’s, are vying for three approvals, which won’t be decided until next May. Each applicant has received $4 million from the federal government so far, and the three successful applicants will be in line for another $47 million each next year, he said.
But they need to get started before that, which necessitates a contingency fund if ultimately the project proves unsuccessful, Wissemann said.
He said they were disappointed that BPU did not accept the settlement arrived at with Rate Counsel, but they will continue working toward gaining that approval.