Selected Projects Will Save New Jersey Ratepayers $900 Million

TRENTON, NJ (Oct. 26, 2022) —The New Jersey Board of Public Utilities (NJBPU) today selected the Larrabee Tri-Collector Solution (LTCS) offshore wind transmission project proposed by Mid-Atlantic Offshore Development (MAOD) and Jersey Central Power & Light Company. MAOD is a joint venture of EDF Renewables North America and Shell New Energies U.S. In addition, the Board awarded onshore grid upgrade projects to enable the capacity injection afforded by the LTCS to Atlantic City Electric, BGE, LS Power, PECO, PPL, PSE&G, and Transource.

These project selections will establish the first coordinated solution for offshore wind transmission in the U.S., testifying to New Jersey’s status as a national forerunner in clean energy production. This coordinated transmission solution will minimize cost and other impacts while supporting the continued expansion of offshore wind energy in the state. It is estimated that the selected projects will save New Jersey ratepayers $900 million compared to the cost of transmission without utilizing this coordinated approach through the State Agreement Approach (SAA).

The Board’s decision today was informed by data, analysis, and expertise from New Jersey’s grid operator, PJM Interconnection. This project represents the first-ever use of the State Agreement Approach between the NJBPU and PJM, utilizing PJM’s competitive transmission planning process to help NJBPU solicit and evaluate 80 different transmission proposals. The Board determined that the selected projects best meet the goals of the SAA solicitation and will result in a more efficient and cost-effective means of achieving 7,500 MW of OSW by 2035, the State’s offshore wind goal at the time of the solicitation.

“New Jersey has been at the leading edge of offshore wind development since Governor Murphy took office, and today’s action is further evidence that we are committed to developing offshore wind and the necessary transmission to shore in the most cost-effective, reliable, and responsible manner possible,” said NJBPU President Joseph L. Fiordaliso. “I would like to thank Board staff for a very thorough job of evaluating the many applications we received for this first in the nation coordinated offshore wind transmission solicitation process.”

The Board also directed its staff to begin necessary preliminary steps to support a future SAA solicitation, to enable the transmission of New Jersey’s new and expanded goal of 11,000 MW of OSW energy by 2040, and to continue its engagement with other states, regional grid operators, and other stakeholders regarding a regional approach to offshore wind transmission.

The approved applicants were part of a competitive solicitation process aimed at exploring coordinated offshore wind transmission solutions. The process identified the most cost-effective, environmentally sensitive, and ready-to-build means of reliably bringing offshore wind energy to shore. A robust public process beginning in 2019 included several technical conferences and four stakeholder meetings, which informed the design of the solicitation and the evaluation of responses.

Under the SAA process PJM designed a transmission solicitation together with Board staff that was issued in April 2021. The SAA solicitation closed in September 2021, and proposals for 80 projects were received from 13 transmission developers.

The MAOD-JCP&L proposal is estimated to cost $504 million. The necessary onshore grid upgrade projects are estimated to cost $568 million, for a total of $1.07 billion for the full LTCS.

A key component of the Board’s decision is to require a successful bidder to New Jersey’s third offshore wind generation solicitation to prebuild a single corridor from the shore crossing to the LTCS. This single corridor will be designed to be utilized by offshore wind projects needed to reach 7,500 MW. This will result in a single onshore transmission corridor which will reduce environmental impact, community disruption, and permitting risks. The Board anticipates issuing the third solicitation in Q1 2023.

The Board and its staff will continue to work with PJM to bring these projects to completion. Following today’s action by the NJBPU Board, the project will now be reviewed by the PJM Board in accordance with its Regional Transmission Expansion Plan process.

Source:  New Jersey BPU Newsroom