|The U.S. and New Jersey flags, flying in the sea breeze at Cape May, NJ.|
Bluewater Wind New Jersey Energy LLC proposed a 350 megawatt wind project off the New Jersey coast. In 2008, the company won a $4 million grant from the state to install an offshore meteorological tower as part of a state-sponsored offshore wind grant solicitation. The grant agreement required Bluewater to install the tower by 2010, and took the form of a rebate: if Bluewater installed the tower by the deadline, it would receive $4 million back from the state.
NRG Energy - a Fortune 250 wholesale power generation company controlling nearly 26 gigawatts of capacity - acquired Bluewater in 2009. Also in 2009, Bluewater asked for and received a one-year extension of the met tower deadline.
In October 2010, Bluewater requested another extension, this time for two years. Bluewater pointed to difficulties in obtaining federal permits for the project. The NJ BPU granted the extension on April 27, 2011, requiring regular progress reporting and installation of the met towers by January 9, 2013. The BPU also lowered the rebate amount to $3 million.
According to the BPU's October 4, 2012 order cancelling the rebate, Bluewater filed progress reports with the BPU in 2011 and January 2012, but ultimately stopped reporting. But in December 2011, NRG announced that it was putting active development of offshore wind projects on hold. By September 2012, BPU staff put NRG on notice that they planned to recommend that the Board cancel its rebate commitment "due to project abandonment and lack of reporting". According to the BPU's order, "the company did not object or otherwise respond when advised of staff's recommendation to withdraw the rebate commitment".
As a result, last week the BPU found that the company had not complied with the order requiring status updates, and thus "that NRG Energy and Bluewater have abandoned the project and will not meet the rebate commitment requirements." The Board cancelled the met tower rebate, and directed BPU staff to reallocate the funding to other New Jersey Clean Energy Programs.