The New Jersey Economic Development Authority (NJEDA) today announced that applications are open for the Offshore Wind Tax Credit Program as updated by the New Jersey Economic Recovery Act (ERA) and P.L. 2021, c. 160. With an overall budget of up to $350 million, the program provides tax credits, often up to 40-60 percent of the qualified capital investments made by a business in a qualified wind energy facility that will be employing at least 150 new, full-time employees.
“Between the New Jersey Wind Port, new offshore wind workforce development programs, and Governor Phil Murphy’s dedication to growing a greener, fairer New Jersey, the Garden State is quickly emerging as the American capital of offshore wind,” said NJEDA Chief Executive Officer Tim Sullivan. “The Offshore Wind Tax Credit is a powerful financial tool that will complement these efforts by enabling global offshore wind companies to make the decision to locate, invest, hire, and most importantly, build a local supply chain here in New Jersey.”
Offshore wind is one of the high-growth, high-wage sectors the State identified in Governor Murphy’s Economic Development Plan and is a central component of Governor Murphy’s Energy Master Plan to achieve 100 percent clean energy by 2050. As part of that plan, New Jersey has committed to producing 7,500 megawatts of offshore wind energy by 2035.
To achieve these goals, the Governor has taken a comprehensive approach to establishing New Jersey as a global hub of offshore wind. In September, the State broke ground on the New Jersey Wind Port, a first-in-the-nation infrastructure investment that will provide a location for essential staging, assembly, and manufacturing activities related to offshore wind projects on the East Coast that has potential to create up to 1,500 manufacturing, assembly, and operations jobs and drive billions of dollars in economic growth. Through the Wind Institute, and in collaboration with the New Jersey Board of Public Utilities (NJBPU), the NJEDA has also awarded nearly $4 million to community colleges throughout the state to support safety training and turbine technician training programs.
The Offshore Wind Tax Credit complements these efforts by providing tax incentives to support businesses making investments in qualified wind energy facilities. Eligible applicants can receive tax credits, often up to 40-60 percent of a project’s qualified capital investments, which can be applied against corporate business tax or insurance premiums. Tax credits are released in increments of 20 percent of the total credit amount per year for five years. Businesses can also sell their tax credits for at least 75 percent of the credit amount.
To receive tax credits, businesses must meet minimum capital investment and job creation requirements. In line with the NJEDA’s commitment to fiscal responsibility, projects must demonstrate that as a result of the capital investment and the resultant job creation, the State of New Jersey will receive at least 110 percent of the total tax credit amount over a 5-year period. Applicants may request an extended net-benefit period of up to 20 years if they can present verifiable evidence of a longer company commitment to the state.
More information about the Offshore Wind Tax Credit, including detailed eligibility criteria, is available at https://www.njeda.com/offshorewindtaxcredit/.
Article Courtesy of the NJEDA