The New Jersey Economic Development Authority (NJEDA) announced that companies making a capital investment in offshore wind-related facilities in New Jersey can now apply for tax credits through the state’s Offshore Wind Tax Credit Program.
According to NJEDA, the Offshore Wind Tax Credit is a financial tool designed to spur private capital investment and employment growth in major land-based projects related to offshore wind. It provides reimbursement for eligible capital investments in industry-specific facilities located in the seven southern counties.
Total credits approved as part of the program are capped at $100 million.
“Encouraging investment in clean energy is a key element of Governor Murphy’s vision for a stronger and fairer New Jersey economy because it creates unprecedented new opportunities for job creation while also providing a healthier, more sustainable future for our families,” said Brian Sabina, NJEDA Senior Vice President – Office of Economic Transformation.
“We are excited to take this critical step forward. The new Offshore Wind Tax Credit Program is a fiscally responsible and targeted incentive that will help accelerate private sector investment into offshore wind infrastructure and manufacturing here in New Jersey. These early investment projects have the potential to attract a broader offshore wind supply chain and position New Jersey as a national leader in the industry,” Sabina added.
Under the program, businesses may qualify for tax credits of up to 100% of capital investments made in a qualified wind facility, but the tax credit amount may be limited by a net positive economic benefits test which uses the project’s estimated tax revenues to ensure the State will receive a return greater than the value of the credit.
Approved entities may elect to apply 10% of the total credit amount per year over a 10-year period against their corporation business or insurance premiums tax or sell the credit for at least 75% of its value.
To qualify for the tax credits, businesses must make a capital investment of at least $50 million in a qualified wind energy facility within one of seven targeted counties: Burlington, Camden, Gloucester, Salem, Cumberland, Mercer, and Cape May.