in News Departments > New & Noteworthy
print the content item

As New Jersey-based Fishermen's Energy awaits a New Jersey Board of Public Utilities (BPU) decision on whether it can use renewable energy certificates to finance its pilot project, the developer is also feverishly working to meet a Feb. 15 deadline to complete a U.S. Department of Energy (DOE) grant application.

Speaking on a conference call, Fishermen's CEO Chris Wissemann explains the developer must receive an affirmative response from the BPU to continue developing the offshore wind project.

"We are nearing the end of the review process," Wissemann says, noting that Fishermen’s completed oral arguments to the BPU on Dec. 20.

The BPU's approval would allow Fishermen's to use New Jersey's offshore renewable energy certificates (ORECs) as part of the Offshore Wind Energy Development Act (OWEDA) to support the financing and construction of the Fishermen's Atlantic Wind Farm, a $200 million demonstration project located three miles off the coast of Atlantic City, N.J.

According to Wissemann, the Fishermen's application has been under review by the BPU for more than 990 days. During the lengthy review process, the regulators raised questions on Fishermen's application, including its choice of turbine supplier XEMC and the impact to state ratepayers if federal tax credits and DOE grants do not materialize.

In July 2013, Fishermen's thought it had reached a deal with the New Jersey Division of Rate Counsel (DRC), which represents ratepayers in the setting of electricity rates. Although the DRC initially opposed the Fishermen’s project, saying it was too costly, the two parties reached a settlement that featured a reduction in the wind farm’s projected rates, thus lowering costs and lessening potential impact to ratepayers.

However, the BPU rejected the settlement agreement, fearing that New Jersey ratepayers would be unduly forced to shoulder too much risk if federal incentives were not included.

One encouraging aspect, Wissemann notes, is that the offshore wind project provides net economic benefits for New Jersey, a key requirement of New Jersey's OWEDA. According to the DRC, the wind farm will create $33 million in net benefits.

Admittedly, Fishermen’s finds itself in uncharted waters, as no offshore wind developer has yet to receive financing under a state-run model based on ORECs like the one being tried in New Jersey and Maryland.

Each of the three U.S. offshore wind power purchase agreements signed to date has been executed under the traditional model, wherein a utility agrees to buy all - or a portion - of a project's output.

"No one else has financed against this particular mechanism," Wissemann explains, noting that Maryland enacted similar OREC-based legislation in 2013.

Complicating matters is that the BPU has a new president. In January, Dianne Solomon replaced former president Robert Hanna. Therefore, Solomon may require additional time to familiarize herself with the Fishermen's case. Though she has little relevant experience, she has plenty of name recognition: She is the wife of former BPU president Lee Solomon, who was Hanna's predecessor.

A BPU decision is expected by June. An affirmative response would allow Fishermen's to begin construction and become operational in 2016, notes Wissemann.

The second - and equally important hurdle - for the developer is a selection by the DOE. In December 2012, the company was one of seven developers to receive a $4 million grant. The companies are now competing with each other to be one of three developers to receive $47 million for four years in the next round of federal grants. According to the DOE, selections will be based on siting, construction and installation for projects reaching commercial operation by 2017. Wissemann expects a decision from the DOE by June.

However, if the DOE does not select Fishermen’s, it is doubtful that the project will get built.

"We are relying on the DOE," Wissemann says, adding that if Fishermen's is not selected, "it would make the economics that much harder."

Trachte Inc._id1770
Latest Top Stories

Utility-Scale Wind And Solar Keep Getting Cheaper

A new study measures the levelized cost of energy from various technologies and suggests that the costs of utility-scale wind and solar power are catching up with those of traditional sources, even without subsidies.

The Song Remains The Same: Ontario Seeks More Science Before Lifting Offshore Ban

The Ontario government says the nearly four-year-old offshore wind moratorium will remain in place until the province fully understands the technology’s impact on the environment.

Why States Should Adopt A Renewable Portfolio Standard

A new study analyzes the potential benefits of state renewable energy mandates, as well as recommends what such policies should include.

Sen. Reid Vows To Bring Wind PTC To A Vote By Year's End

Nevada's senior senator provides some encouragement to wind industry advocates during his annual Clean Energy Summit.

Steadily, Wind Turbine OEMs Resume R&D Investment

An increased commitment to research and development will likely lead to wind energy innovation - not to mention a likely increase in patent-protected technology.

Renewable NRG_id1934
Future Energy_id2008