Despite the recent financial setbacks to the Cape Wind project, New Jersey will be following Massachusetts and clearing its water for offshore wind development, Governor Chris Christie announced on Monday.
The NJ Board of Public Utilities will open an application for Offshore Wind Renewable Energy Certificates (ORECs), with the goal of reaching 1,000 MW of power from wind turbines. The application window closes on June 14.
“The wind power movement is providing us with a unique opportunity to advance energy as industry,” Christie said. “We have the ability to leverage our tremendous resource with ground-breaking technologies, allowing New Jersey to increase its use of renewable energy sources while advancing an industry that will lead to long term job creation.”
The NJ project came just a few weeks after the American Wind Energy Association (AWEA) issued a celebratory first quarter report, announcing that 1,100 MW of new wind capacity had been installed in the U.S. in 2011 alone, more than double the amount completed in the first quarters of 2010 or 2009. Although the federal government has cut back on renewable energy credits (RECs) for wind, 5,600 MW is currently under construction, according to the AWEA report.
The sustained construction is a sign that developers are beginning to see wind a cost-effective alternative to fossil fuel generation. With no need for fuel, wind power’s main cost is construction, which Chief Economist of the AWEA Liza Salerno estimates at $1.7 to $2.1 million per MW for onshore wind turbines. This cost would likely be somewhat steeper for offshore development.
“Wind is being built purely for economic reasons,” Salerno told Breaking Energy. It remains to be seen if offshore wind, with its potentially higher construction costs and transmission costs, will prove cost-effective as well.
Christie has been preparing NJ for this new development since he signed the Offshore Wind Economic Development Act last year, which provides tax credits to business that construct, manufacture and assemble water access facilities needed for offshore wind projects.
