Public Service Enterprise Group has no interest in building wind farms off the Jersey coast but is looking to take advantage of the huge opportunities available as the emerging offshore-wind industry grows in the state, according to executives.
How so is suggested by a memo of understanding the Newark company signed with Ocean Wind LLC, a wholly owned subsidiary of Ørsted US Offshore Wind, one of three developers seeking to build up to 1,100 megawatts of wind turbines off the coast near Atlantic City.
PSEG has entered into an energy-management services agreement with the developer, a step that could lead to one of its subsidiaries selling power from the wind farm into the marketplace, according to Ralph LaRossa, president and COO of PSEG Power, the unregulated generation company owned by PSEG.
PSEG also has given Ocean Wind access to land adjacent to the company’s three nuclear units in Salem County, LaRossa said. The companies are looking at the potential of the site as a place to assemble the huge turbines that would generate power for the offshore-wind farm.
“We are reviewing the viability of that site,’’ said Michael Jennings, a spokesman for the PSEG. “That is an option we are looking at.’’
The advantage of the site is its location on Delaware Bay and turbines assembled there would not have to pass under the Delaware Memorial Bridge to be shipped to the proposed offshore-wind farm about 15 miles from Atlantic City.
PSEG also is interested in helping offshore-wind developers build the transmission needed to bring the power from the wind farms to the markets where the demand is needed, most likely northern New Jersey and the metropolitan area.
“We think we can help on the transmission side,’’ LaRossa told analysts yesterday at the company’s annual investors conference at the New York Stock Exchange. “We will do what we know how to do.’’
PSEG also has an option to acquire an interest in Ocean Wind, but LaRossa indicated the company has no intention of taking on risk in the construction and generation sides of the offshore-wind business.
Besides Ørsted, two other developers are seeking to win approval to build offshore-wind farms off the Jersey coast — Equinor, which has a project off Sandy Hook, and EDF Renewables/Shell Energies, with a project eight miles north of the Ocean Wind project. The state is expected to decide what projects move forward by the end of June.
PSEG has plenty of experience on the transmission side, investing billions of dollars in the past five years to upgrade and modernize a system that, in many instances, is nearly a century old. Transmission upgrades are a big part of PSEG’s capital investment program, spending on which is projected to amount to between $11 billion and $16 billion over the next five years, including a $5 billion allocation to transmission upgrades.
Overall, more than 90 percent of the company’s capital investment program is slated to go to Public Service Electric & Gas, the state’s largest regulated utility. That reflects the parent company’s transition from one supplying power to an “infrastructure company,’’ said Ralph Izzo, president, CEO and chairman of the parent company.
The company’s capital investments are aligned with the Murphy administration’s clean-energy goals, designed to have 100 percent clean energy by 2050 and to combat emissions that contribute to global warming.
PSE&G now has more than $6 billion worth of filings pending before the state Board of Public Utilities, according to Izzo. The bulk of those investments are comprised of a $2.6 billion energy efficiency filing and a $2.5 billion filing to modernize and upgrade the company’s gas and electric distribution and transmission systems.