Offshore wind: NJ, Phil Murphy bet on clean energy, but who will pay?

Russ Zimmer | Asbury Park Press

Show Caption Hide Caption Offshore wind: From a turbine in the ocean to your home in the suburbs New Jersey is moving forward with a plan to install enough offshore wind turbines to power 1.5 million homes by 2030. How do gusts 20 miles off the coast turn into the electricity that lights up your home when you flip a switch?

The winds of change are blowing.

By 2050, every single kilowatt of electricity in New Jersey is supposed to originate from a clean fuel source, according to promises made by Gov. Phil Murphy. Offshore wind energy is expected to make up a significant share of that zero-emission generation.

Under the state's ambitious clean energy strategy, 12 years from now 3,500 megawatts — that's enough juice for about 1.5 million homes — will be generated by the spinning blades of gigantic steel wind turbines planted in the ocean off our coast. Watch the video above to see how a gust of wind 20 miles off the coast turns into the current that keeps your lights on.

Of course, there's still the little matter of how we're going to pay for this.

NJ MARIJUANA LEGALIZATION: Assembly speaker Craig Coughlin supports legal weed, wants 'right bill'

OYSTER CREEK: Holtec to take down plant in 8 years

It's universally understood that even with the advances made in the economics of offshore wind, the industry will still need electricity customers to prop it up — at least in the short-term.

Right now, state regulators can't say how much extra they'll expect you to pay.

Whether wind energy can replace the jobs lost at traditional power plants remains to be seen. New industries always promise job creation. Sometimes that faith is rewarded.

It's clear that we're at a crossroads on how to best meet the demand for electricity and the cost in dollars is just one consideration. Climate change, which is propelled by mankind's burning of fossil fuels, is another.

Many power plants in the region are reaching the end of their useful lives — think of Oyster Creek, the nuclear plant in Lacey that will stop generating electricity next month.

Backers of offshore wind power are trying to position wind as the fuel of the future and a natural fit for the Garden State.

"Due to the dense population which results in high electricity usage in the mid-Atlantic, and its easily accessible coastline, the region makes a strong case for offshore development," said Hasting Stewart, spokesman for Equinor, the Norwegian wind farm operator formerly known as Statoil. "It’s the nation’s most congested area, with very few places to put new power generation or transmission on land. Additionally, community and civic leaders in the region have expressed a strong interest in clean energy solutions."

SIX FLAGS GREAT ADVENTURE: Relive the amusement park's thrilling legacy

What's the plan for NJ?

We'll use the word "plan" here loosely because there isn't much official language to reference at this point. More on that later.

Developers are attracted to the federal waters off of New Jersey, but not every chunk of open ocean is appropriate for a wind farm. The traffic into and out of the Port of New York and New Jersey renders parts of sea adjacent to Monmouth County unusable for wind power.

The Bureau of Ocean Energy Management, the arm of the U.S. Department of Interior that oversees offshore wind, has "not received interest in the areas directly offshore Monmouth County for offshore wind development, either by the state of New Jersey or industry," a spokesperson for the BOEM told the Asbury Park Press.

Ocean County is a different story. Seven miles east of Barnegat Light lies the northernmost point of OCS-A 0499, a commercial wind lease held by US Wind, a 7-year-old subsidiary of an Italian conglomerate.

Farther off the coast is the Hudson South, a tract within the New York Bight — 2,355 square miles of relatively shallow water where the BOEM is entertaining the possibility of additional wind energy leasing. The Hudson South stretches from Asbury Park down to Atlantic City, coming no closer than 20 miles to the shore.

SHARKS: Tiger shark devours N.J. tuna fisherman's catch

There is also the dormant Fishermen's Energy project, the proposed 24-megawatt wind farm three miles off the Atlantic City coast that has been twice rejected by the state because, among other reasons, the high cost to be absorbed by ratepayers.

A New York State project, Empire Wind, is sited about 20 miles south of Long Island and is about the same distance on its western edge from Long Branch. All of that energy — as the project's name implies — is destined for New York customers.

Video: New York unveils $6B offshore wind power plan New York Democratic Gov. Andrew Cuomo plans $6 billion of offshore wind projects off the southern coast of Long Island by 2028. Video via Business Insider

How much will it cost?

Anyone who pays an electric bill will absorb some of the cost to produce power from offshore wind, because of both the enormous initial investment and the market set by far cheaper natural gas.

For instance, US Wind, which has the rights to 183,000 acres off of the south Jersey coast, will receive $131.93 for every megawatt-hour produced from 2021 to 2041 for consumers in Maryland.

That's about 2½ times the average wholesale price in the Washington D.C. area, according to PJM, the regional electrical grid supervisor.

Maryland says the additional burden on ratepayers is "projected to be less than $1.40 per month for residential customers and less than a 1.4 percent impact on the annual bills" of businesses, according to the Maryland Public Service Commission.

Proponents of offshore wind acknowledge the additional costs but they argue that those figures will steadily fall and that freeing the air of toxic emissions and greenhouse gases are worth it.

"With fossil fuels, there are public health costs and climate change and all the damage that wreaks, especially on a coastal state like New Jersey," said Tom Gilbert, campaign director of ReThink Energy NJ, a clean energy advocate. "There are investments that need to be made in energy and energy infrastructure and the key is to make the right investments."

NJ FISHING: Ground lost in beach replenishment, fishermen say

While generally supportive of the diversification of New Jersey's energy portfolio, the private sector is wary of the additional line item that will be tagged onto utility bills, according to the New Jersey Business and Industry Association, which represents private sector companies that employ a combined 1 million people in the state

"As the cost of this investment will ultimately be recovered from ratepayers who are already paying among the highest prices in the nation," reads a letter from the NJBIA's head lobbyist Christine Buteas to the state, "the BPU should ensure that its process for soliciting and selecting bids for offshore wind energy considers the economic impact of those projects on ratepayers and any indirect effects they may have on the market as a whole."

What will it look like?

US Wind's $1.4-billion Maryland project would see 32 turbines anchored into the seabed some 100 feet below the water's surface 17 miles off the coast of Ocean City.

At that distance, a wind farm would not obstruct the serene views that beachgoers have come to expect, said Joe Fiordaliso, president of the New Jersey Board of Public Utilities president.

“The turbine is going to look like a toothpick, literally," he said. "That’s how small it will look (from the beach).”

US Wind's project near Ocean County would be 10 miles closer.

No one expects huge factories to be erected overnight to manufacture the 200-foot long turbine blades, but the assembly and construction of these towering structures could yield long-term employment locally, experts say.

"There are 90,000 solar installations in the state," said Fiordaliso, "and 7,000 people are working in the solar industry. We expect the same kind of thing to happen with wind."

FIGHTING FRAUD: 'Press on Your Side' live coming to Brookdale

Why now?

Offshore wind has been booming in Europe, which is helping to drive down the cost of the technology worldwide.

A change in leadership certainly plays a part in New Jersey's newfound aggressiveness.

Former Gov. Chris Christie signed the Offshore Wind Economic Development Act eight years ago, but the plan languished in his administration and never produced any wind projects.

At the end of February, Murphy signed an executive order that called for "the full implementation" of the 2010 law.

Murphy ran on a pledge to pivot to clean energy sources because of climate change, something that Christie acknowledged as a reality but not a crisis.

“Climate change is real," said Fiordaliso, "and we have to do — I believe this and the governor (Murphy) believes this — anything possible to mitigate the effects.”

New Jersey is one of a handful of states that are using public policy to divorce from "the polluting energy sources of the past" despite a doubling-down on fossil fuels at the federal level, Gilbert said.

"There are states that are absolutely tackling climate change — that are moving to clean energy — because they understand there is great urgency to reduce emissions, especially given that Washington is failing to do so," Gilbert said.

What's next?

It's unlikely that we'll see turbines poking out of the horizon until 2022, according to Gilbert.

Fiordaliso, the BPU president, said a consultant has been selected to create an Offshore Wind Strategic Plan, a handbook that will spell out the standards for developers and chart a path to 3.5 gigawatts.

The identity of this outside adviser is not publicly known, and won't be until the contract is approved by the New Jersey Treasury Department.

POLLUTION: NJ Attorney General cracking down on violators

A site plan for the US Wind project closest to Ocean County isn't due until next spring, according to a timeline of the project.

Generally, it takes about a decade from when a specific wind farm idea is first floated until it is operational. In between, there are years of planning, environmental assessments and construction.

But proponents of wind energy are encouraged by what they see as a cooling of partisanship in Washington surrounding the development of offshore wind.

Video: Can Trump Save Coal? Coals biggest problem isn't regulation but competition from the natural gas industry.

It's not as if President Donald Trump is embracing the technology so much as his administration is not blocking its way, they say.

“In all honesty, I think the Secretary of the Interior has not put any obstacles up and I think that's important," Fiordaliso said. "As far as help is concerned, I'm not seeing a lot of that, but I am not seeing a lot of obstruction either — other than the fact they are subsidizing the coal industry and that money could be used in other ways.”

POWER OUTAGES: Utilities flopped in storm prep, must do better, state says

Russ Zimmer: 732-557-5748, razimmer@app.com, @russzimmer