The Federal Energy Regulatory Commission has approved a groundbreaking agreement allowing the New Jersey Board of Public Utilities to use PJM’s competitive planning process to help the state achieve its ambitious offshore wind goals.
In an April 14 order (PDF), FERC accepted the executed State Agreement Approach Agreement between PJM and the New Jersey Board of Public Utilities, effective April 15.
The agreement details the contractual commitments and responsibilities of PJM and the NJBPU regarding the competitive selection of transmission solutions to enable New Jersey’s goal of delivering 7,500 MW of offshore wind generation to its residents by 2035.
“This first-of-its-kind agreement with New Jersey Board of Public Utilities on behalf of New Jersey provides a unique pathway to help states reach their energy policy goals while maintaining the focus on reliability and affordability,” said Suzanne Glatz, Director – Strategic Initiatives and Interregional Planning. “FERC’s order establishes a template for all states in the PJM region to implement their specific public policies with the help of PJM’s independence, expertise and proven competitive planning process.”
The State Agreement Approach was incorporated into PJM’s Operating Agreement eight years ago as part of the implementation of FERC Order 1000, but this is the first time a jurisdiction in the PJM footprint has requested to use it to further its renewable energy goals.
The provision enables a state, or group of states, to propose a project to assist in realizing state public policy requirements as long as the state (or states) agrees to pay all costs of any state-selected build-out included in the Regional Transmission Expansion Plan (RTEP).
Typically, the RTEP includes projects driven by reliability or market-efficiency criteria.
After previous FERC approval to pursue the collaboration, PJM administered a competitive solicitation window from April 15 to Sept. 17, 2021.
PJM received a robust response and is in the process of evaluating 80 proposals to cost-effectively deliver offshore wind generation to the existing bulk electric grid.
Transmission component options include grid-to-onshore substations, onshore substations to offshore collector farms and an offshore transmission “backbone.” PJM plans to make a recommendation to the NJBPU by the end of the summer, and New Jersey expects to make a decision by the end of the year about which – if any – projects it wants to pursue. The state retains the right to elect whether to move forward with any project proposal.