Fishermen's eyes DOE contract
Fishermen’s Energy hopes to finalize a contract by the end of this month with the US Energy Department (DOE) that will allow disbursement of up to $46.6m in funding to deploy a 25MW pilot wind project in state waters off Atlantic City, New Jersey.
DOE in May selected Fishermen’s and two other pilot offshore projects (among six proposals) for a second round of funding subject to annual progress reviews. The developers will use the money for follow-on design, fabrication and deployment in order to achieve commercial operation by 2017.
Fishermen’s will demonstrate the use of a twisted jacket foundation that is easier to manufacture and install than traditional foundations, helping drive down the cost of energy produced by the offshore wind system.
The project will also act as an “at-sea laboratory” to investigate the interactions between turbines, test new control systems, and provide information about potential environmental impacts of offshore wind, according to DOE.
Among the DOE requirements is that the developer have an off-take agreement in place for the project’s full nameplate output one year from now, Rhonda Jackson, communications director for Fishermen’s, tells Recharge.
That will present a challenge as New Jersey’s board of Public Utilities (BPU) in March denied ratepayer subsidy support for the project, saying it did not provide a “net economic benefit” for the state.
In its decision, the regulatory body also ruled the project is too expensive and creates an unacceptable level of risk for ratepayers if it wasn’t selected for further DOE funding.
The ruling deprived Fishermen’s of the opportunity to help fund the project using proposed state Offshore Renewable Energy Certificates. It is the first developer to apply for the program with the BPU.
BPU in April rejected Fishermen’s motion to reconsider its decision, prompting the developer in May to file a legal appeal against the state in the Appellate Division of the Superior Court.
“After being awarded the DOE grant, thus addressing the BPU’s concern about Fishermen’s Energy not receiving the federal funding for the project, the team is confident of a positive outcome from the appeal process,” Jackson says.
If Fishermen’s can’t nail down a power purchase agreement, DOE officials emphasize that it will cut funding for the project.
Meanwhile, Jackson says that Fishermen’s wants to test and pre-commission the XEMC-Darwind XD115 5MW direct-drive wind turbine that it wants to use for the project. This would be done in South Carolina at the Clemson University Restoration Institute’s facility that can test turbine drivetrains up to 15MW.
“Testing is anticipated to begin in 2015. However, an agreement will need to be signed with Clemson outlining the scope of work and logistics of the testing,” Jackson says.
China’s XEMC Group owns about 70% of the Fishermen’s project and its executives visited the Charleston facility in April. A consultant’s report done for BPU expressed concern that the turbine technology was unproven and staff there factored that into their recommendation that BPU commissioners reject the project.
XEMC also potentially has a lot at stake with the testing outcome as validation of the turbine would give it a selling point into the US market. It is hoping to use Fishermen’s pilot project to demonstrate the turbine and compete with European vendors for utility-scale contracts along the US east coast.
Fishermen’s has already committed to using XEMC turbines for a proposed 330Mw array in federal waters off New Jersey’s coast.