The New Jersey Economic Development Authority and PSEG have signed a longtime lease on land that is planned to become home to the New Jersey Wind Port — a step enhancing the state’s goal of becoming the hub of a burgeoning offshore wind industry.
The site, located on an artificial island in Lower Alloways Creek in Salem County next to three PSEG nuclear plants, is viewed by the administration of Gov. Phil Murphy as an almost ideal location to serve the supply needs of an offshore wind sector that’s expected to take root up and down the Eastern seaboard.
With an expansive footprint alongside Delaware Bay, lack of height restrictions, and easy access to the Atlantic Ocean’s wind farm lease areas, the Wind Port is one of a few select spots on the East Coast that can accommodate the marshalling, assembly and shipping of the huge turbines used to generate offshore wind power. Hundreds of feet tall, offshore wind turbines cannot fit beneath bridges, power lines and other naturally occurring barriers.
PSEG — depending upon how the Wind Port is built out to serve the sector, including potential manufacturing facilities — will benefit from the lease agreement, which could last as long as 78 years. Under the terms of the agreement, the initial 28-year lease will cost the state $89 million, although the EDA expects that sub-rents commencing in 2024 will help defray those costs.
Access to state funds
NDEV LLC, a newly created subsidiary of PSEG Nuclear, signed the lease with the EDA. AECOM-Tishman will manage construction of the Wind Port. The authority will compensate NDEV LLC for the cost of relocating facilities at the site and other expenses.
PSEG officials also have expressed an interest in building the interconnections that will bring power from offshore wind farms onto land and then to locations where it can be delivered to the customers.
“The New Jersey Wind Port is a transformational investment that will create hundreds of good jobs and drive billions of dollars of economic activity in South Jersey and throughout the state,” said EDA Chief Executive Officer Tim Sullivan.
New Jersey has approved three wind projects, including two by Ørsted, one of the largest offshore wind developers, and another by New Shell Ventures and EDF Renewables — all in the Atlantic Ocean. The Murphy administration wants to develop 7,500 megawatts of offshore wind capacity by 2035.
Along the East Coast, offshore investment through 2035 is anticipated to exceed $150 billion, according to the EDA.
“The first rule of real estate and offshore wind is location, location, and location,’’ said Doug O’Malley, director of Environment New Jersey. “The New Jersey Wind Port is uniquely positioned to jump start the state’s offshore wind industry and offshore wind in the region.’’
— This story was updated to clarify aspects of the lease agreement.