The Appellate Division of the Superior Court of New Jersey has ruled against the Fishermen's Atlantic City Wind Farm (FACW), claiming that the New Jersey Board of Public Utilities (BPU) wrongly denied approval of the wind power project, located off the coast of Atlantic City.
Fishermen's, which was one of three offshore wind developers to receive $47 million from the U.S. Department of Energy's (DOE) offshore wind technology program last year, intends to appeal the decision.
‘While we will review the opinion carefully over the next few days,’ notes Paul Gallagher, chief operating officer of Fishermen's Energy, ‘it is our intention to bring an appeal to the New Jersey Supreme Court.’
At issue is cost. FACW was attempting to avail itself of credits from the state's Offshore Wind Economic Development Act (OWEDA) to use in financing the 25 MW offshore wind demonstration project. In March 2014, the New Jersey Board of Public Utilities (BPU) rejected FACW's application for several reasons, including concerns about the project's economic and technological viability, the cost of the electricity it would produce, and whether the project would produce a net benefit under the OWEDA statute.
In April 2014, Fishermen's asked the BPU to reconsider its decision and claimed that the regulators mistakenly based the decision on a $263/MWh OREC price when the actual proposed price was $199.17/MWh.
Despite the fact that FACW reaffirmed to the BPU that it could meet the $199.17/Mwh price through federal subsidies and DOE funding, the court rejected the developer's appeal.
In the ruling, the court writes, ‘After reading the voluminous record presented to us, we cannot conclude that the [BPU] decision was arbitrary or unsupported by evidence. The record is replete with expert reports and filed testimony, setting forth conflicting views about the viability of FACW's proposed project and the wisdom of approving it.Â
"In the final analysis, the [BPU] was persuaded that FACW had not established the financial viability of the project, or the financial integrity of its business partners, and the [BPU] was not persuaded that the risks and costs of using an unproven technology to produce electricity at prices several times the market price were offset by the asserted benefits of the project.’
To read the court ruling, click here.
The decision could be the final blow for the beleaguered offshore wind project and the latest in a string of bad news for the nascent U.S. offshore wind industry. In January, for example, two utilities voided their power contracts with the 468 MW Cape Wind project, and in April, Dominion Virginia Power put on hold its offshore wind demonstration project, claiming escalating construction costs.Â Â Â