Danish offshore wind developer Ørsted and the state of New Jersey have been sued over a $1bn tax break the company received to develop the 1.1 GW Ocean Wind 1 project.
Protect Our Coast NJ (POCNJ) and Defend Brigantine Beach (DBB) filed a joint lawsuit in the Superior Court of New Jersey claiming that such a tax break was in violation of the New Jersey Constitution as it authorizes subsidies to a single offshore wind developer and its subsidiaries – Ocean Wind LLC and Ørsted North America, Inc.
The lawsuit also claimed that the Danish wind developer lobbied the State of New Jersey for additional project funding citing inflationary, labour, and supply chain issues.
In response, the lawsuit stated, Governor Phil Murphy signed off on shifting federal credits earmarked for New Jersey customers to the offshore wind developer via NJ law A5651.
The A5651 is seen by POCNJ and DBB as unconstitutional special legislation intended solely to protect Ørsted from business and financial risks it voluntarily took on in an approved agreement with the NJ Board of Public Utilities.
As a result, the state’s subsidy allows the wind developer to keep federal tax credits it would have normally been required to pass along to utility ratepayers.
The construction of Ocean Wind was approved in early July. The project will consist of 98 turbines in waters near Atlantic City and is supposed to generate 1,100 megawatts of power and power around 380,000 homes.
