New Jersey BPU authorizes PJM to solicit potential offshore wind transmission solutions

November 19, 2020

by Paul Ciampoli
APPA News Director
November 19, 2020

The New Jersey Board of Public Utilities (NJBPU) on Nov. 18 authorized the PJM Interconnection to solicit potential offshore wind transmission solutions from qualified developers on behalf of NJBPU.

The move makes New Jersey the first state to engage in a competitive solicitation process managed by PJM for such critical planning, the NJBPU said in a news release.

In late 2019, New Jersey Gov. Phil Murphy signed an executive order raising New Jersey’s offshore wind goal from 3,500 megawatts of offshore wind-generated electricity by 2030 to 7,500 MW by 2035. The executive order will deliver renewable energy generation needed to help meet the state’s goals of 50 percent renewable energy by 2030.

The NJBPU formally requested the inclusion of this state public policy into the transmission planning process of PJM through a competitive solicitation process in what is known as the “State Agreement Approach.”

“The State Agreement Approach was written broadly to accommodate the breadth and diversity of policies that different states might pursue,” said Manu Asthana, President and CEO of PJM. “It is an existing tool that states can use to leverage PJM’s regional transmission planning expertise. In this case, we are pleased to be able to help New Jersey advance its offshore wind objectives.”

The NJBPU is asking that PJM integrate the state’s offshore wind transmission policy goals into the grid operator’s transmission planning process through the State Agreement Approach established by the Federal Energy Regulatory Commission’s Order No. 1000, which aimed to open the building of new transmission lines to competition.

By making this formal request, the NJBPU said it can utilize the State Agreement Approach to explore options for an optimal long-term solution for offshore wind transmission that otherwise may not have been available at this stage of development.

Through the solicitation process, the NJBPU will examine details on a wide array of ready-to-build transmission options, including key factors such as cost, siting, environmental impacts, and the timeframe for construction, it noted.

“The process will also allow NJBPU to determine how a coordinated approach can lead to more cost-effective, efficient transmission solutions that minimize the environmental impacts of bringing wind energy ashore,” it said in the news release.

There are no financial or ratepayer obligations with the announcement, which goes into effect after the state’s second offshore wind solicitation.

Additionally, the competitive solicitation process “contains extensive consumer protections, including the ability to control cost and timing implications by incorporating transmission upgrades in a phased manner,” the NJBPU said.

The NJBPU directed its staff to work with PJM to seek potential solutions for three interrelated components of an open access offshore wind transmission facility: (1) onshore upgrades, (2) beach crossings with potential offshore “collector” platforms, which collect energy from multiple wind farms, and (3) an ocean transmission “backbone” to connect multiple collector platforms or lease areas.

The NJBPU said it will assess whether proposals for any of these components can meet the state’s offshore wind policy goals in an economically efficient, environmentally sensitive, and timely manner.

The NJBPU intends to work with PJM to open the solicitation in 2021 and evaluate competitive project proposals in concert with the grid operator, including any cost considerations.

At the end of the process, NJBPU will decide whether to proceed with any combination of the proposed transmission projects, but it reserves the right to terminate the process at any time without making a selection.

Additional information about New Jersey’s offshore wind program is available here.