Brief

DOE to pull funding from New Jersey offshore wind project

Dive Brief:

  • Fishermen's Energy, a wind farm proposed for offshore New Jersey, failed to submit power offtake contracts by the end of 2016, meaning the U.S. Department of Energy will pull almost $40 million in funds it had committed.
  • About $11 million has already been spent, according to a report from the Associated Press. The project aimed to construct six 4-MW turbines just a few miles off Atlantic City.
  • State regulators have rejected the plan three times, according to the AP, preventing the company from signing power contracts. Fishermen's CEO told the outlet they wait friendlier state policies to be adopted and try to keep the project afloat without federal funding until then.

Dive Insight:

Offshore wind energy projects continue to struggle in the United States.

The country has just one operating offshore wind facility, and the loss of funding for the New Jersey project represents a lost opportunity to some. U.S. Sen. Bob Menendez, (D-NJ) told AP the loss of the project is "deeply frustrating and defies common sense that the state would turn away a nearly $50 million federal investment."

Fishermen's Energy had planned to use a "twisted jacket foundation" that is easier to manufacture and install than traditional foundations, a move which helped it secure funds from the Department of Energy. But state regulators reportedly took issue with a number of project details, including a previous 70% ownership stake by a Chinese firm.

DOE tapped three projects in May receive approximately $10.7 million in funding, with each eligible for up to $40 million in additional funding. But the lack of a power offtake agreement by Fishermen's Energy means the project is eliminated from contention. The Lake Erie Energy Development Co Icebreaker project and University of Maine's Aqua Ventus I were also awarded funds.

Despite the industry's nascent state, federal studies show the Atlantic, Pacific, Gulf of Mexico, and Great Lakes have a 4.2 GW potential wind power cumulative capacity. DOE says its new National Offshore Wind Strategy could help enable the development of 86 GW of offshore wind by 2050.

Deepwater Wind's Block Island project began operations in December; the 30 MW facility is first offshore wind farm to deliver energy to the American power grid.

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