New Jersey set for new transmission call to cover beefed-up offshore wind target
Move follows pioneering solicitation last year awarded to consortium including Shell-EDF that would save US state's ratepayers $3bn
New Jersey’s utility regulator kickstarted a second offshore wind transmission solicitation with a formal request to regional operator PJM to include the state’s expanded targets into its planning efforts.
New Jersey Board of Public Utilities (NJBPU) made the request following its monthly meeting in which it unanimously affirmed the motion to open a second tender under PJM’s State Agreement Approach (SAA) process.
SAA is PJM’s federally approved process by which public policy goals carry equal weight to reliability, need, and cost when planning transmission upgrades.
“Today’s action is extremely important for the future of our offshore wind program,” said NJBPU president Joseph Fiordaliso. “We must create additional pathways for wind energy to be brought on shore and into the PJM grid.”
NJBPU staff recommended that the board request PJM seek potential transmission solutions for three interrelated components of an “open access offshore wind transmission system”.
These would include “upgrades to the onshore PJM regional grid, construction of the necessary shore crossings, and connecting the new or existing onshore substations to new offshore substations,” said Jim Ferris, deputy director of NJBPU’s division of clean energy.
SAA 2.0 would potentially connect different offshore substations serving various lease areas into an offshore grid, Ferris added.
NJBPU identified the Deans 500kV substation in New Brunswick, New Jersey, as the likely point for grid interconnection due to its proximity to load centres and lease areas and “having available capability to accommodate the desired injection”.
This substation was not a requirement, though, and NJBPU said: “Transmission developers will be allowed to propose particularly cost-effective alternative points of interconnection that may still meet the state’s immediate policy goals.”
Under the SAA process, New Jersey ratepayers bear the entire cost of the build out, and NJBPU staff highlighted ratepayer protections, including cost containment options and phased implementation of any transmission upgrades.
Such provisions would “allow the state and PJM to consider such items as the financial strength of any construction scheduling commitments, and the developers incorporation of voluntary cost caps into their bids,” Ferris said.
Along with its pioneering approach to transmission and leading offshore wind goals, New Jersey is also investing heavily into supply chain and port capacity, led by flagship New Jersey Wind Port (NJWP), under development in Salem County. The port has been confirmed for marshalling for Orsted's 1.1GW Ocean Wind 1 project and Atlantic Shores' 1.5GW array.
PJM is the nation’s largest regional transmission operator, covering 13 states in the Mid-Atlantic region, including offshore wind leaders Maryland, New Jersey, and Virginia, with a combined 25GW of offshore wind mandates.
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