According to the Associated Press, the largest Massachusetts-based, investor-owned electric and gas utility, NStar decided to purchase power from Cape Wind offshore wind farm.
The contract is worth $1.6 billion and is intended for15- years- long period. This is $940 million more that the market price of conventional electricity for the same period.
The Cape Wind farm, $2.6 billion project, aimed at creating nation’s first offshore wind farm, resulted in numerous disputes. Namely, the wind farm, which is situated on Horseshoe Shoal in Nantucket Sound, to be comprised of 130 wind turbines and produce up to 420 megawatts of clean, renewable energy, is supposed to cover up to three quarters of the Cape and Islands electricity needs. This would bring energy independence, clean air and boost economy in terms of employment; however the prices of the final product seem to be too high.
“It’s hard to imagine that the state could have forced a more expensive and burdensome agreement on Massachusetts households, municipalities and businesses, “ Audra Parker, president of the anti-Cape Wind group the Alliance to Protect Nantucket Sound stated.
Namely, the contract will mean additional $1.08 to the monthly bill of an average household.
On the other hand, in order to meet the state requirements related to reduction of pollution and purchasing renewable energy, NStar spokeswoman Caroline Pretyman, while commenting on the contract signing with the Cape Wind farm said:
“We recognize that there is a cost associated with renewable energy, but we see it as an investment in the state’s clean energy future”.
The NStar company‘s share of 27.5 % of the projected power output of the wind farm, in addition to 50 % of its output intended for National Grid utility will result in ensuring customers for Cape Wind farm and thus attract new investors, who would finance further development of the project.
Prices of the Cape Wind’s power will be 19.3 cents per kilowatt hour in 2014, when Cape Wind is expected to start generating power and they go up for 3.5 % on annual basis. However, in case the Congress fails to renew the “production tax credit” or the “investment tax credit”, the power prices could be higher, namely 21.9 cents per kilowatt hour and the total contract price would rise to $1.8 billion.
[mappress]
Offshore WIND staff, April 03, 2012