Competitive Power Ventures' 663-Megawatt, Combined-Cycle Power Plant in New Jersey Stuck in Litigation

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Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--Competitive Power Ventures LLC (CPV) (Silver Spring, Maryland) wants to spend about $900 million to build a 663-megawatt (MW), combined-cycle, natural gas-fired generator in New Jersey. Regulators from New Jersey and PJM (the grid operator serving Pennsylvania, New Jersey and Maryland) also want CPV to build that generator, the Woodbridge Energy Center. New Jersey's businesses and homeowners probably would welcome Woodbridge, as it could bring down the price of electricity in a high-priced market. And the company owning the land where CPV wants to build its project certainly would welcome the start of construction.

But incumbent generators in PJM, who have the most to lose, have dug in their heels and delayed the start of construction with state and federal litigation, according to Braith Kelly, CPV's spokesman. "The Woodbridge project will generate electricity at a substantially lower price" compared to New Jersey's prevailing electricity prices, he told Industrial Info in an interview. "But incumbent generators oppose it because scarcity does wonders for prices. They want to keep getting high prices for their electricity."

In early 2011, the Woodbridge project was one of three generation projects selected by the New Jersey Board of Public Utilities (Trenton, New Jersey) to be constructed in that state pursuant to a new state law that encouraged the construction of new generation. The Woodbridge project has been developed to minimize its environmental footprint. It is scheduled to be built on a "brownfield" site that is undergoing environmental remediation to remove low levels of radioactive contamination. It will use two 7FA high-efficiency turbines manufactured by General Electric Company (NYSE:GE) (Fairfield, Connecticut). The plant will be cooled mainly by partially recycled "grey water" from the nearby Middlesex County Utilities Authority. And CPV plans to minimize its emission of oxides of nitrogen (NOx) by installing low-NOx burners and Selective Catalytic Reduction (SCR) equipment.

With a 30-month construction schedule, the Woodbridge project is scheduled to be in service in 2015, Kelly said. But it may have trouble keeping its schedule. It has not yet received its required permits. It has not yet selected an engineering, procurement and construction (EPC) firm. Construction has not begun. Incumbent generators have filed state and federal lawsuits aimed at blocking the project. And the end of 2015 is just less than 30 months away.

"PJM has decided to retire 24,000 MW of coal-fired generation," Kelly said. "You can't retire 24,000 MW of generation in the region and not have that affect prices or reliability. Today, we're not in an electricity crisis. But in two years, if new generation is not built in PJM, we will be in a crisis. New Jersey, in particular, will have substantial problems keeping the lights on at an affordable price unless new generation is built in the state."

"The litigation could be over tomorrow, or it could take two years to conclude--there's no way to know once something lands in court," he said.

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