Wind jumpstart

Delivered every Monday by 10 a.m., New York & New Jersey Energy is your guide to the week’s top energy news and policy in Albany and Trenton.
Jan 22, 2024 View in browser
 
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By Ry Rivard and Marie J. French

Good morning and welcome to the weekly Monday edition of the New York & New Jersey Energy newsletter. We'll take a look at the week ahead and look back on what you may have missed last week.

QUICK FIX

WIND RESET — New Jersey’s Board of Public Utilities is expected to approve one or more new offshore wind projects during a special meeting Wednesday, a chance for the state to jumpstart the industry following Orsted’s cancellation last fall of two of the three previously approved projects in the state.

Gov. Phil Murphy told a room full of financial analysts last week to expect a “big" move from the BPU as he continued to tout the offshore industry’s role in the state’s economic future. Murphy has set arguably the most ambitious offshore wind goals of any governor. As of today, there are no offshore turbines generating power for New Jersey or yet under construction, so there has been pressure on New York to move ahead with projects to keep the industry afloat in this region.

New Jersey officials were otherwise tight-tipped ahead of the possible approval of projects this week. In New Jersey, the BPU solicits bids from developers and then awards contracts to developers for projects based on a combination of factors. The awards are essentially an agreement by the BPU to direct ratepayer dollars to buy power from the offshore wind generation projects if wind developers deliver the power and meet certain benchmarks.

Four groups of developers are vying for such awards, including Atlantic Shores, a partnership of Shell and French energy giant EDF and the only company with a previously approved project that it is still intending to build it in the state following Orsted's exit. Atlantic Shores has said its previously approved project is in need of a boost to make it financially viable.

Other bidders are Attentive Energy, a subsidiary of TotalEnergies; Community Offshore Wind, a joint venture between RWE and National Grid Ventures; and Leading Light Wind, a partnership of Invenergy and co-developer energyRe.

As bad as 2023 was for the offshore wind industry — with financial peril and canceled or shaky projects up and down the Eastern Seaboard — 2024 could provide a chance for some new projects to get approved with different terms that allow them to remain viable come what may. For instance, the next generation of New Jersey projects is expected to include some kind of inflation-adjustment mechanism that would help projects deal with the kind of macroeconomic challenges that have made previous projects with different terms uncertain.

Plus, when it comes to the two canceled Orsted projects — known as Ocean Wind 1 and 2 — there have been quiet talks at some points in the past few months to keep a version of them alive but perhaps in another developer’s hands. It’s unclear where that all stands now. — Ry Rivard

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Here's what we're watching this week:

MONDAY
— New York Sen. Lea Webb and Assemblymember Anna Kelles join advocates pushing to shut down New York’s largest landfill in Seneca Falls, 11 a.m., New York State Capitol.

TUESDAY
— NYSERDA and DEC hold the first webinar in their second stage of outreach on cap-and-invest focused on the role of the program, 3 p.m.

— The Renewable Heat Now coalition holds a lobby day in Albany.

— NYSERDA hosts more offshore wind open houses, noon and 7 p.m., Hofstra University, Sondra and David S. Mack Student Center, Hempstead.

WEDNESDAY
— New Jersey Board of Public Utilities holds a special board meeting to considers awarding new offshore wind generation projects, 10 a.m.

— NYSERDA hosts another offshore wind open house, 6 p.m., Long Beach Public Library, 111 W. Park Ave., Long Beach.

THURSDAY
— NYSERDA and DEC hold the second webinar in their second stage of outreach on cap-and-invest focused on the pre-proposal outline released late last year, 1 p.m.

FRIDAY
— NYSERDA and DEC hold the third webinar in their second stage of outreach on cap-and-invest focused on the preliminary analysis of the costs and impacts of the program, 11 a.m.

AROUND NEW YORK

— Fireplaces appear to get a pass from energy transition.

Around New Jersey

— More reporting on officials’ decision not to help elevate homes in Manville, a community hard hit by Hurricane Ida-related flooding.

— Philadelphia Inquirer: “A portion of the landscaping installed at a recently constructed three-level, seven-bedroom house in the Avalon dunes violated state land use regulations, the N.J. Department of Environmental Protection has concluded. A notice issued Wednesday to Vahan and Danielle Gureghian, owners of the Dune Drive property, said an inspection Oct. 20 found that a “lawn area” had replaced about 8,470 square feet of undeveloped ground where alterations are restricted under the state’s Coastal Area Facility Review Act.”

— Temps in the 60s by week’s end?!?

What you may have missed

PINELANDS REPORT: Gov. Phil Murphy can do more to protect the Pinelands by filling vacancies on the Pinelands Commission and better funding that agency, according to the annual "State of the Pinelands” report by the Pinelands Preservation Alliance, a nonprofit activist group. While Murphy has worked to fill seats on the commission — before that there were times it was unable to conduct business — there are still three vacancies, including one created by the death of long-time Pinelands advocate Ed Lloyd, who died in August. “His seat is still empty,” said Jaclyn Rhoads, one of the group’s advocates, during a Thursday call with the press.

Alliance executive director Carleton Montgomery said the vacancies mean there are fewer board members to push staff to do things. The commission is tasked with preserving one million ecologically sensitive acres in South Jersey. Because of funding issues, there are also not enough staff to do things like prepare for the effects of climate change on the Pinelands, advocates said.

The Pinelands alliance is among the park advocacy and green space groups that have complained about money lost due to the expiration of a surcharge on the corporate business tax. The group pegs the revenue lost by letting that surcharge go away at nearly a half billion dollars over the next decade and the source of “irreparable harm.” — Ry Rivard

IDLEWILD GREENLIT: The Public Service Commission on Thursday approved costs for a Con Ed project that will be paid for by customers. The commission signed off on $1.2 billion for a new substation in Idlewild and other components to support growing electricity demand in Queens including from MTA bus depots and the JFK airport. The company petitioned for approval of the project in August, saying action was needed quickly because electrification would increase demand beyond the capacity of the existing Jamaica network by 2026.

“Con Edison will be making infrastructure investments that are designed to promote the transition to a clean-energy economy while ensuring the reliability of the electric grid overall,” said PSC Chair Rory Christian in a statement. “Our action today is a win-win for the company’s customers and the environment.”

Some clean energy developers urged the commission to require Con Ed to instead examine non-wires alternatives like battery storage or demand response to avoid the expensive infrastructure project. New York City also argued the plan does not comprehensively address growing demand and is not a cost-effective solution.

Commissioner Diane Burman voted against the commission order. She said such investments should be scrutinized as part of the regular rate case process for utilities. Burman also questioned whether all ratepayers should have to bear the cost of these upgrades, which she said are primarily driven by electrification projects and demand from the MTA and JFK airport. “I do not think it is sustainable as we do more electrification.. that the ratepayers bear the bulk of this,” she said. The MTA has committed to electrifying its entire bus fleet by 2040 and the authority supports the Con Ed project.

“As we work towards New York’s clean energy goals, we must think more boldly about ways to serve increased demand for electricity while maintaining a reliable grid as customers transition away from fossil fuels,” said Tim Cawley, Con Edison’s chairman and chief executive in a statement.

The commission also approved a cleanup of the transition in Con Ed’s territory from community credits for solar project to upfront community adders, which resulted in overpayments to some developers, according to NYSERDA’s petition.

State agencies will have an easier road to building and owning their own small-scale solar and other distributed energy resources 5 megawatts or less. The commission approved an updated interconnection agreement for state agencies, which couldn’t put up funds in the way required by the standard agreement among other barriers. “This order will enable state agencies to pursue a wider range of options and to do so more economically and more efficiently than currently allowed,” said Christian at the meeting. “The progress may not move at a pace and fast enough for some. This commission actively seeks out opportunities to enhance clean energy markets.”

… More from the meeting: Another working group will examine advanced transmission technologies. Budgets for the next phase of the statewide energy database (the Integrated Energy Data Resource project) were approved. — Marie J. French

HUDSON RIVER UPDATE: The draft five-year review for the Hudson River cleanup might, maybe, possibly, come out in March, EPA’s Gary Klawinski told the community advisory group on Thursday. Members of the group raised ongoing concerns about people who are eating fish out of the upper Hudson River and frequently from the southern parts of the river. Environmental groups and community advocates are pushing EPA to determine that the dredging by GE was not effective enough in cleaning up the river and protecting humans eating fish from the river. “The agency will follow the science and the law in our determinations, that's what we do. We have no choice,” Klawinski told the group.

Klawinski urged members of the advisory group to inform the EPA if they’re aware of people eating fish from the river. “It's very hard to tell somebody that has been out there all day fishing on the river, that — especially if he speaks or she speaks a different language — that you can't take that fish home,” said Gil Hawkins, an advisory group member with the Hudson River Fishermen's Association. “It's our job to clean up the river so they don't have to be told.” — Marie J. French

BUDGET BREAKDOWN: Gov. Kathy Hochul is including funding for flood control projects in her executive budget but wants to reduce the annual amount for water infrastructure projects.

Hochul proposed only $500 million over two years for clean water infrastructure, setting up a battle with top environmental leaders in the Legislature and advocates. The chairs of the Environmental Conservation Committee want to see the amount kept at $500 million annually, and environmental groups and other advocates are organizing to push for $600 million.

The program has been funded at $500 million each year since 2017. It provides grants to local governments for drinking water and wastewater projects. The state expects to receive $2.6 billion in funding from the federal infrastructure law for water infrastructure projects as well.

“This is not a moment that we should be taking our foot off the gas, our goal when we pushed to pass the bond act and when we advocate for environmental funding is to make sure the resources are closer to meeting the need,” said Jessica Ottney-Mahar, The Nature Conservancy’s policy director. “There’s a lot of water infrastructure needs in New York State … so to see a reduction in that program is concerning.”

Blake Washington, Hochul’s budget director, said the reason for the new funding level was that there was $1 billion in clean water infrastructure money that hasn’t been spent, plus more from the bond act. “It’s a wildly popular program,” Washington said. “We’re just trying to right size the spending. … We want to show our commitment to the program.” — Marie J. French

TOLLS ARE UNCONSTITUTIONAL? — POLITICO’s Ry Rivard: Gov. Phil Murphy’s administration asked a federal judge to let New Jersey add constitutional elements to its lawsuit meant to block New York’s congestion pricing plan.

The request, made in a Tuesday court filing announced by the governor’s office, would seek to amend his lawsuit from last summer that challenged a federal environmental review of the tolling plan and was originally aimed at Biden administration transportation officials.

SUPERFUND SPENDING — The day before the federal government is expected to unveil revisions to a settlement with dozens of companies accused of polluting the Passaic River, New Jersey’s Senate President Nick Scutari highlighted a Senate resolution urging the EPA to spend settlement money on the river itself. The Senate resolution about spending at Superfund sites passed by voice vote last week, on the final day of the last legislative session. The federal government is expected to file in court on Wednesday a revision of a $150 million deal proposed in late 2022 to settle the federal government’s claims against 85 companies accused of contaminating the Lower Passaic River.

“It is important that the EPA recognizes the vital need New Jersey has to clean contaminated Superfund sites,” Scutari said in a Tuesday statement that seemed timed to the Wednesday court filing expected by attorneys for the federal government. “The settlement funds should be used for remediation work at the sites and the portion of the settlements used for the agency’s administrative costs should be strictly limited. The actual clean-up work should be the priority.”

Scutari’s statement said it is unclear if the settlement money will go toward the remediation or the EPA administrative costs. The remarks come amid intense criticism of the settlement by one of the polluters that is not part of the settlement, Occidental Chemical Corp., which has criticized the EPA and wants to pursue its own legal action against other polluters. A study by the EPA found that OxyChem, as the company is known, is responsible for all but a tiny portion of the river’s portion, a finding the company is disputing. The river is expected to cost billions to clean up. — Ry Rivard

 

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