USA: NJ Long Term Projects Will Not Benefit Much from Tax Credit Extension

The extension of the tax credits for wind energy development, for which the United States Congress voted on Tuesday, is not going to be a significant help for long term offshore wind projects in New Jersey, as the incentive expires at the end of 2013 and the construction there is expected to begin long after that.

The developers are more focused on what the state of New Jersey is doing on the offshore wind matter. “From our perspective, we’re looking first at what New Jersey does,” Erich Stephens, vice president of Offshore MW, is cited by NJ Spotlight news site as saying.

Mr. Stephens added: “Without the New Jersey program, it really does not matter (about the federal tax incentives).’’

He did, however, agree that the extension of the investment tax credit sets the stage for future renewal of the credits.

The main reason for delays in offshore wind development off New Jersey is that the state’s Board of Public Utilities (BPU) has not yet developed an effective system for offshore wind subsidies included in ratepayers’ electricity bills.

“It has been almost two years since the Offshore Wind Economic Development Act regulations were supposed to have been put in place and we have no progress and no windmills off our coast,’’ Jeff Tittel, director of the New Jersey Sierra Club, is quoted by the news site as saying.

On the other hand, Jim Lanard, president of the Offshore Wind Development Coalition, explained that the BPU is working out final details of its OREC regulations at this time and the federal government expects to start the auction process for leasing land on the outer continental shelf off of New Jersey’s coast in the near future.

“The availability of the investment tax credit for offshore wind farms provides the certainty developers need to finance and begin construction of their projects,’’ Mr. Lanard said.

[mappress]

Offshore WIND Staff, January 3, 2013; Image: Bard Offshore