TRENTON — Opponents of Ocean Wind 1, the wind farm planned off the coast of Cape May and Atlantic counties, filed suit to block federal subsidies from going to Ørsted, the Danish company behind the project.
Two citizens groups, Protect Our Coast NJ and Defend Brigantine Beach, and three Ocean City residents filed the suit, arguing subsidies from the New Jersey Legislature are an “unconstitutional state giveaway,” according to their attorney, Bruce Afran. The individuals are Barbara McCall of 21st Street, Frank Coyne of Asbury Avenue and Bill Westerman, owner of George’s Candies and George’s Ice Cream on the boardwalk.
The suit was filed in Superior Court in Trenton to stop almost a billion dollars in federal tax credits given to the company in a bill approved in July in the state Legislature and signed by Gov. Phil Murphy. The suit argues the bill was illegal “special” legislation in violation of the New Jersey Constitution.
“The Legislature’s giveaway of federal tax credits to Ørsted benefits a single company in violation of the New Jersey Constitution,” Afran said in a release announcing the lawsuit. “In New Jersey, laws that favor a single private party are generally unconstitutional.”
With substantial fanfare July 6 at the Paulsboro facility that is manufacturing the massive monopiles that will hold as many as 98 wind turbines in the Ocean Wind 1 project, Murphy signed the bill to give Ørsted federal tax credits to help ensure manufacturing remains in New Jersey after New York offered that incentive to do the work in the Empire State and the Maryland governor wants a facility there.
Those tax credits would have otherwise gone to New Jersey ratepayers.
Steve Sweeney, who pushed to get the monopile plant in Paulsburo while he was Senate president, had advocated for the tax break. He now chairs the Sweeney Center for Public Policy’s advisory board at Rowan University.
“It is appropriate that Gov. Murphy chose to sign the tax credit bill at the EEW AOS plant in Paulsboro because investments like this ensure that offshore wind farms up and down the Atlantic Seaboard will be built with components manufactured by New Jersey workers and shipped out of New Jersey ports,” Sweeney said at the time.
Afran said that in signing the law, the governor reversed the New Jersey Board of Public Utilities’ 2019 order “that required Ørsted to refund the tax credits to ratepayers to keep the costs of the 98-unit turbine facility from being paid by the public.” He said the company demanded the additional credits because without them, “inflation” and “supply chain” issues meant it could no longer build the wind farm.
Afran said New Jersey’s Division of Rate Counsel criticized the bill, claiming there was no evidence Ørsted needed the credits.
“Basically, the Legislature caved to the Danish engineering company, giving away a billion dollars in tax credits to relieve Ørsted from its commitment to build Ocean Wind 1 from its own money,” Afran said.
The suit is pending before Superior Court Judge Douglas H. Hurd in Trenton and is expected to be briefed and argued later this fall.
Monopiles — which would be embedded deep in the sea floor and then rise hundreds of feet to allow for the sweep of the blades attached to the GE Haliade-X wind turbines — are being welded, sandblasted and painted at EEW American Offshore Structures’ facility at the Port of Paulsboro, which the company says is the first monopile-fabrication facility in the U.S. Ørsted said it “has made significant investments in the facility as part of its commitment to building a local, American offshore wind supply chain.”
Offshore installation of those monopiles and wind turbines is expected to begin in 2024.
Ørsted is partnering with Rowan University to recruit New Jersey residents for a paid training program to become wind turbine technicians.
The 1,100 MW project would generate enough electricity to power 500,000 homes starting in 2025.
There are multiple wind farms in various stages, from proposed to working through the regulatory process. Ørsted has already proposed Ocean Wind 2 with as many as 111 wind turbines that would be adjacent to Ocean Wind 1. Just to the north of both are Atlantic Shores South and Atlantic Shores North with a combined 352 turbines.
Supporters of the projects cite high-paying union jobs that they would create while detractors say the projects will hamper the tourism economy and could equate to a loss of $1.11 billion in Cape May County.
Protect Our Coast NJ and Defend Brigantine Beach have argued against the projects for multiple reasons, including the impact on the environment and the belief they will be visual pollution on the horizon that will harm property values at the shore.
Environmental groups are split on the wind farm projects as well, with some believing the need for alternative energy to combat global warming is paramount with others seeing harm to marine mammals and other species.
On July 5, the U.S. Department of the Interior’s Bureau of Ocean Energy Management (BOEM) granted the state’s first offshore wind project its Record of Decision, which Ocean Wind officials called a major milestone in the federal environmental review process.
What is needed next is approval on a Construction and Operations Plan (COP) to build the wind farm, which would connect with the power grid in New Jersey with cables running underground through Ocean City to Beesleys Point in Upper Township.
The company believes onshore work in the two communities could begin as early as this fall with offshore work starting in 2024.
By DAVID NAHAN/Sentinel staff