Newsroom & Public Notices
New Jersey Board of Public Utilities Launches State Agreement Approach 2.0
| For Immediate Release: | Contact: Peter Peretzman |
| Date: 04/26/2023 | 609-900-5626 |
“Today’s action is extremely important for the future of our offshore wind program,” said NJBPU President Joseph L. Fiordaliso. “As we look to achieve Governor Murphy’s new, increased goal of 11 GW of offshore wind capacity by 2040, we must create additional pathways for wind energy to be brought on shore and into the PJM grid.”
“New Jersey has been a pioneer in developing infrastructure needed to achieve its ambitious offshore wind policies,” said Manu Asthana, PJM President and CEO. “NJBPU recognized early on the value of PJM’s independent, competitive and proven transmission planning process, and we look forward to continuing to help New Jersey achieve its offshore goals reliably and as cost-effectively as possible.”
This will be the State’s second use of the SAA to optimize the delivery of offshore wind generation into the State’s transmission system. It is expected that SAA 2.0 will solicit proposals to inject the additional 3.5 GW needed to reach the State’s new 11 GW goal at the Deans 500 kV substation. However, transmission developers will be allowed to propose particularly cost-effective alternative points of interconnection that may still meet the State’s immediate policy goals.
The Deans 500 kV substation was identified by PJM and Board Staff for SAA 2.0 because it: 1) is located near high electric load centers; 2) is accessible to the Bureau of Ocean Energy Management (BOEM) offshore wind lease areas that are likely to service New Jersey; and 3) was previously identified by PJM as having available capability to accommodate the desired injection.
In 2020, the Board formally requested the inclusion of New Jersey’s then offshore wind public policy goal of 7.5 GW by 2035 into PJM’s transmission planning process, which resulted in a competitive solicitation for a variety of transmission projects.
That process resulted in the selection of the Larrabee Tri-Collector Solution 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 several other onshore grid upgrade projects to enable the capacity injection afforded by the Larrabee Tri-Collector Solution to Atlantic City Electric, BGE, LS Power, PECO, PPL, PSE&G, and Transource. Using the SAA process to identify and award these projects is estimated to save ratepayers hundreds of millions of dollars, in addition to providing many other ancillary benefits.
The exploration of coordinated transmission alternatives through SAA 2.0 will have no impact on the offshore wind projects that have already been awarded, or that will be awarded up to a total of 7.5 GW. Those projects will interconnect as directed in the applicable Board Orders approving qualified offshore wind projects. SAA 2.0 will be used for new, approved projects up to the Governor’s new goal of 11 GW.
PJM’s RTEP rules contain substantial protections for ratepayers and as with SAA 1.0, the Board reserves the right to select any or no projects in the SAA 2.0 process. It is anticipated that choosing a transmission project or projects through SAA 2.0 will result in lower costs for ratepayers than if NJBPU had not employed the SAA process, while also reducing environmental and community impacts and maintaining safe and reliable electric service.
As part of today’s action, the Board directed Staff to prepare an SAA 2.0 Solicitation Guidance Document (SAA 2.0 SGD) that will include details regarding the solicitation components and the proposal evaluation process, and to issue a draft SAA 2.0 SGD for public comment in order to inform the development of the final SAA 2.0 solicitation.
Staff has also been directed to accelerate engagement with other states, regional grid operators, federal regulators, and other interested stakeholders about a regional offshore wind transmission solution.
NJBPU will immediately work with PJM to begin the SAA 2.0 process.
About the New Jersey Board of Public Utilities (NJBPU)
NJBPU is a state agency and regulatory authority mandated to ensure safe, adequate and proper utility services at reasonable rates for New Jersey customers. Critical services regulated by NJBPU include natural gas, electricity, water, wastewater, telecommunications and cable television. The Board has general oversight and responsibility for monitoring utility service, responding to consumer complaints, and investigating utility accidents. To find out more about NJBPU, visit our website at www.nj.gov/bpu.
About New Jersey’s Clean Energy Program (NJCEP)
NJCEP, established on January 22, 2003, in accordance with the Electric Discount and Energy Competition Act (EDECA), provides financial and other incentives to the State's residential customers, businesses and schools that install high-efficiency or renewable energy technologies, thereby reducing energy usage, lowering customers' energy bills and reducing environmental impacts. The program is authorized and overseen by the New Jersey Board of Public Utilities (NJBPU), and its website is www.NJCleanEnergy.com.
