By Jon Hurdle for NJ Spotlight
When Ørsted abandoned its plans for a massive wind farm off the Jersey Shore, it was a major blow to the Murphy administration and its promise of more renewable energy serving the state by 2040.
But the energy developer’s exit does not represent a total loss, as it readies to sell its ocean leases amid signs of strong demand from developers.
According to industry analysts and others, the offshore wind industry is poised to buy up the ocean leases that could generate enough power for some 1 million New Jersey homes,
One or more developer is now expected to acquire the leases that would have allowed Ørsted to create its Ocean Wind 1 and 2 projects about 15 miles off the coast of South Jersey in what would have been the state’s first commercial-scale offshore wind farms.
The Danish wind giant’s shocking withdrawal on Halloween last year was a major setback for the Murphy administration’s plan to install 11 gigawatts of carbon-emissions-free offshore wind power — enough to power more than 8 million homes — by 2040, prompting Gov. Phil Murphy to blast the decision as “outrageous.” It now seems unlikely that New Jersey will be able to meet that deadline given the long lead time and high cost of building wind farms.
But wind industry sources predict that new developers will soon offer to buy the leases, drawn by slowing inflation, lower expected interest rates, and more attractive terms for offshore wind power now offered by New Jersey regulators.
“The economics for offshore wind have been changing for the past year or so,” said Kris Ohleth, executive director of the Special Initiative on Offshore Wind, a consultant to the industry. “If there’s an opportunity out there, developers are going to have a keen interest in getting into the market.”
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