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New Jersey Republicans call for audit of wind power deal




Wind turbines producing energy along the coastline.

PH Korsart | Shutterstock

(The Center Square) — The fallout over Ørsted's decision to pull the plug on New Jersey's offshore wind projects is mounting, with Republicans calling for an audit of the state's contract providing taxpayer subsidies to the Danish-owned company.

Last week, Ørsted announced that it is walking away from two large offshore wind power projects off the coast of New Jersey. The move delivered a major blow to the state's clean energy plans and Gov. Phil Murphy's push to put the coastal state at the forefront of the nation's nascent offshore wind industry.

The company attributed the decision to scrap the projects to "significant adverse developments from supply chain challenges, leading to delays in the project schedule, and rising interest rates," among other factors.

Murphy has called the move "outrageous" and said his legal office is looking into a provision of the company's development agreement that requires it to pay New Jersey $300 million to support the offshore wind sector if the projects don't proceed. 

But the state's Republican minority, which has consistently opposed the offshore wind projects, wants the Murphy administration to open up its books on the agreement and for the state Attorney General's office to claw back any taxpayer money. 

In a letter to Murphy, GOP leaders requested details of an agreement with Ørsted allowing the company to keep an estimated $1 billion in federal tax credits that were supposed to be passed to New Jersey utility ratepayers to offset the potential for higher electricity rates.

"We want transparency and accountability for this colossal waste and failure so nothing like it happens again," they wrote. "Equally important, we want assurances that your administration is exhausting every effort to regain up to $1 billion in cash and tax credits allocated to this boondoggle." 

Sen. Michael Testa, Jr. R-Vineland, said the Murph administration must "take immediate action to regain any funds that were used to subsidize Orsted’s failed wind farms." 

"New Jerseyans have a right to know how much of their tax dollars were wasted on this boondoggle and what the administration intends to do to get it back," he said.

The lawmakers said they also want details, including emails and documents, outlining when the Murphy administration was told that Ørsted was abandoning the project, whether legislative leaders were notified in advance, and "what, if any, steps were taken by your administration to delay action on a public announcement?" 

Ocean Wind I called for developing 1,100 megawatts of offshore wind in waters located 15 miles off New Jersey's coast to generate enough electricity to power more than 500,000 homes. Ocean Wind 2, a similarly situated 1,148-megawatt offshore wind project, called for powering an additional half-million homes.

In July, Murphy signed an agreement with Ørsted, allowing the company to keep federal tax credits that were supposed to be passed to New Jersey utility ratepayers to offset the potential for higher electricity rates. 

The tax breaks, estimated by some at $1 billion, drew a lawsuit by two citizens groups who have asked a state Superior Court judge to declare the move unconstitutional. The outcome of that case is still pending.