SOUTH JERSEY (KYW Newsradio) — Wind farm contractor Orsted is now on the hook for $100 million if its offshore wind project in New Jersey isn't completed on time.
There's a firm deadline for Orsted to complete construction of Ocean Wind 1 off the coast of Atlantic and Cape May counties in little over two years. Otherwise, it will forfeit $100 million in escrow.
Details of the deal were included in previously passed legislation. Board of Public Utilities chief council Mike Beck outlined the deal at a board meeting this week.
"By the terms of the parent company guarantee, Orsted AS unconditionally and irreconcilably guarantees to BPU and the State of New Jersey that the Ocean 1 project shall reach commercial operation within 12 months of its board-established commercial operations date," he said.
The initial date for completion was December 2024 and with the 12-month extension, the project must now be done by December 2025.
If the board determines Orsted hasn't held up its end of the deal, the legislation says the state could then return the money to ratepayers or use it for other offshore wind infrastructure.
An Orsted spokesperson told KYW Newsradio, "This week's action by the NJ Board of Public Utilities continues the process of complying with the statutory requirements outlined in legislation signed by Gov. Murphy earlier this year."
