The state of New York’s move toward renewable energy recently hit a crucial milestone. Unfortunately, this development caused the projects to reevaluate their current position and request more funding, which Governor Kathy Hochul has not yet approved.
New York’s Public Service Commission will decide the funds next week. The funding would help four offshore wind and eighty-six land-based renewable energy projects. These projects are projected to account for nearly twenty-five percent of the state’s expected energy needs in the year 2030, by which New York must meet a statutory seventy percent renewable electricity target. Anne Reynolds, the executive director of the Alliance for Clean Energy New York, requested an additional $26 billion on behalf of the project’s developers. Reynolds stated that the adjustment is vital for completing the tasks on time. The developers acknowledged that it was an economic challenge but asked that the adjustment be granted to avoid it becoming a political issue.
Equinor and BP are the developers of the Empire Wind and Beacon Wind Projects. The companies pushed back on those calling for a complete re-bidding process, commenting that it would only delay the projects further and increase costs. If the PSC approves the total request, it will cause an increase in individual electricity bills by $4.60 per month. While this has caused pushback to the request, Reynolds, Equinor, and BP argued that over time, the green energy generated from the projects would more than makeup for the cost now. Reynolds explained this will help gain support for the transition to renewable energy in the future because the cost of electricity will dramatically decrease.
The request for additional funding was cited as an adjustment for post-pandemic inflation. Many industries were affected by supply chain issues during the COVID-19 lockdown, and construction was no exception. Three renewable energy projects in New Jersey are facing similar funding woes and have yet to receive any extraordinary relief from the state thus far.
Earlier this year, the New Jersey governor’s office pushed through a bill to save Ocean Wind 1, one of two offshore wind farms developed by energy giant Orsted, from financial uncertainty. However, the project has since faced more delays. Ocean Wind 2, the second Orsted project, is in a similar situation, but no progress on financial relief has been made. Bailey Lawrence, a spokesperson for the governor’s officer, cited inflation and supply chain challenges in New Jersey and the Northeast as the reason for these delays. New York faces the same economic and technical challenges and must decide whether the environmental or economic impact is more urgent next week.
The New York Department of Public Service plans to meet several times this week to discuss these issues. The organization will hold public hearings on Wednesday, October 25, and the rate hike for electricity consumers is on the agenda for their meeting on Thursday, October 26. The New Jersey Board of Public Utilities will also meet on Wednesday to discuss the future of the Ocean Wind 2 project.
