State rejects Atlantic City offshore-wind project for third time — too pricey 

The state has once again rejected a plan to build a small pilot offshore-wind project off Atlantic City, a decision seemingly at odds with the Murphy administration’s commitment to make New Jersey a national leader in an emerging clean-energy sector.

The project, located in state waters 2.8 miles off the resort city, was deemed too costly to ratepayers who would finance the 25-megawatt wind farm and unable to demonstrate it would be a net economic benefit to New Jersey and the customers who would pay for it.

This marked the third time the state Board of Public Utilities has refused to approve the Nautilus Offshore Wind LLC project by EDF Renewable Energy. Prior iterations of the proposal had been pushed by Fishermen’s Energy and rejected for largely the same reasons by state regulators during the Christie administration.

Doug Copeland, regional project manager for EDF, called the decision very disappointing. “With permitting already in place, Nautilus is the only project capable of giving New Jersey an early lead in the offshore wind space race,’’ he said. “We think the state is missing out on a great many opportunities.’’

Only one offshore-wind farm is operating in the U.S., but states up and down the Eastern Seaboard are developing aggressive plans to build turbines off their coasts, with none more ambitious than New Jersey.

Fiordaliso: Benefits were ‘too tentative’

Gov. Phil Murphy has opened a solicitation to build up to 1,100 MW off the Jersey coast, a process expected to draw interest from up to five offshore-wind developers in an application window that closes three days after Christmas.

Nautilus has touted its three-turbine project as serving as a pilot to develop the infrastructure and skilled workforce to establish New Jersey as a leader in the offshore wind industry. It had its backers.

“Although Nautilus was a small project, it has always offered significant value beyond the clean power in the form of continuing the efficiency of the New Jersey offshore wind supply chain and business community,’’ said Liz Burdock, president and CEO of the Business Network for Offshore Wind.

The project had its detractors, too. The New Jersey Division of Rate Counsel opposed the project, calling its price to ratepayers too high and its supposed benefits too nebulous.

BPU president Joseph Fiordaliso agreed. He described the price that customers would pay, which the state declined to reveal as “confidential,’’ as much higher than similar projects elsewhere in the U.S. and in the United Kingdom.

“Simply stated, the Nautilus proposal contains a price too high and benefits too tentative,’’ Fiordaliso said. The state law promoting offshore wind requires developers to show a net economic benefit to ratepayers, who will ultimately foot the cost of the electricity generated by the wind farms.

Several environmental groups opposed

The project also drew opposition from New Jersey Audubon, the National Wildlife Federation, and the American Littoral Society, among others.

“Pursuing offshore wind as an element of the state’s response to climate change has a place in the agenda, but it cannot be done at the cost of our coastal and marine wildlife,’’ said Tim Dillingham, executive director of the American Littoral Society.

The state Department of Environmental Protection has conducted extensive studies on how birds and marine wildlife would be impacted by offshore wind farms, and essentially found the potential harm to wildlife is minimized the farther the turbines are located offshore.

The projects expected to come in to the BPU by the end of the year are expected to be located in federal waters extending from 10 miles to 20 miles off the coastline. Those projects are expected to be utility-scale wind farms, bringing economies of scale to lower the cost to ratepayers.