The Port of New York and New Jersey is looking to develop a marine terminal focused on serving the region’s growing offshore wind energy sector, freshly boosted last month when New Jersey gave the green light to the state’s first offshore wind project.
A wind energy terminal was one of two suggested uses when the Port Authority of New York and New Jersey last fall sought expressions of interest in developing two plots of land in the port — a 100-acre site in Elizabeth, New Jersey, and a 70-acre site on Staten Island, New York — for use catering to the alternative energy sector. The authority also sought proposals for using the locations as a bunkering site for liquefied natural gas (LNG).
Although no concrete proposals were submitted, the authority sees the solicitation as ahead of its time, and expects interest in wind-related cargo to grow as more projects are lined up, said Beth Rooney, Deputy Port Director, Port Authority of New York and New Jersey.
The potential for serving the wind and LNG sector was mentioned as emerging trends in the authority’s 2050 Port Master Plan released last week, which predicts that demand for dry bulk will increase nearly 50% to 5.5 million metric tons over the next 30 years, consisting mostly of cement, salt, and scrap dry bulk cargo.
Rooney said the solicitation of interest last fall came too early, and the port will continue to look for interested developers. “Nobody was going to be looking to use or develop or lease port authority property, or anyone else’s property, when they don’t have a contract from the states,” Rooney said.
On June 21, New Jersey gave approval to Denmark-based Ørsted to build a 1,100-megawatt wind farm off the Jersey shore that will feed electricity into the state’s power grid. And more projects are expected to follow, Rooney said.
Across the Hudson River, New York Governor Andrew Cuomo said he would quadruple the state’s target for power generated by offshore wind farms by 2035 to 9,000 megawatts. Cuomo, in his budget address in January, pledged to invest up to $200M in port infrastructure to support the sector. He is looking to solidify New York’s position as “the hub of the burgeoning US offshore wind industry.”
As more projects are approved, developers will likely think about the supply chain to support them, Rooney said.
“They might do manufacturing or fabrication areas, so they could be building out the turbine blades,” at the terminal, she said. “They could be building the cables there. They could be manufacturing the [windmill] foundations. Any number of components could be manufactured there on the facilities and then put on vessels and brought to an assembly area where the turbine is assembled before going out to the offshore farm.”
Coastal states see opportunity
New Jersey, with wind energy projects totaling just 9 MW of power up and running, lags most of the nation in wind power implemented, according to the American Wind Energy Association (AWEA). New York, with 1,987 MW, is ranked 14th. The only offshore wind farm operating in the US is a 30-MW project in Rhode Island.
Coastal states are racing to establish offshore wind farms in the US, said Luke Lewandowski, Director of Research, in the Chicago office of Wood Mackenzie, the international energy consultancy. WoodMac forecasts the US will have about 4.7 gigawatts of installed offshore capacity, or 16 operating projects, by end 2024.
Offshore requires a lot of big equipment bolted to the seabed, deepwater ports for bringing in larger vessels, staging areas at ports for marshaling and mobilizing, construction vessels, and special vessels for laying power transmission cables. Several factors favor offshore wind development in the US Northeast: There is a density of energy load, transmission lines are closer to load centers, and cities are more progressive and receptive to renewable wind energy.
The prospect of offshore wind energy development has already prompted investment by the state of Massachusetts in the Port of New Bedford. New London, Connecticut is also positioning itself to serve the wind energy sector, the AWEA said.
Reprinted with permission from Hugh R. Morley.
About the author:
Hugh R. Morley is Senior Editor for the JOC.com and Journal of Commerce, which is a subsidiary of IHS Markit. He covers the port of New York and New Jersey, as well as various US Northeast and Mexican ports, and co-chairs the JOC’s Mexico Trade Forum, launched in 2018. He has written on business for 15 years, covering a range of topics, from government oversight of business to corporate legal battles and the fierce interstate competition for jobs and investment, and has been a journalist for 25 years. He holds a bachelor’s in management and operational research from the University of Leeds and a master’s in global business from Rutgers University. He can be reached at hugh.morley@ihsmarkit.com
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