Avangrid, part of the Iberdrola Group, has filed a motion with the Massachusetts Department of Public Utilities (DPU) to suspend for a month the review of the Power Purchase Agreements (PPAs) for the 1,232 MW Commonwealth Wind offshore wind project.
According to Avangrid’s statement, under the current PPAs, the Commonwealth Wind project is no longer viable and would not be able to move forward.
“In response to the unprecedented economic challenges facing all major infrastructure projects, including historic price increases for global commodities, sharp and sudden increases in interest rates, prolonged supply chain constraints, and persistent inflation, AVANGRID has filed a motion with the Massachusetts Department of Public Utilities seeking a one-month suspension in the review of the Power Purchase Agreements (PPAs) for the Commonwealth Wind project”, Avangrid said in its latest press release.
A one-month suspension would enable the parties to consider potential approaches to restore the Commonwealth Wind project’s viability. This includes cost-saving measures, tax incentives, increasing the PPA prices, and improving project efficiencies.
This could also involve determining whether additional time, beyond the requested period is needed to resolve the issues.
“A one-month suspension in the proceeding provides a needed opportunity for AVANGRID, the Massachusetts Electric Distribution Companies, state and regulatory officials, and stakeholders to evaluate the current economic challenges facing Commonwealth Wind and assess measures that would return the project to economic viability including, but not limited to, modest changes to the PPAs”, according to the company’s statement.
Avangrid said it remains fully committed to the project and added that Commonwealth Wind offshore wind project is still well-positioned to reach commercial operations in 2028 and help the state achieve its 2030 emissions reduction target .
In May, Eversource, National Grid, and Unitil submitted the agreements to the DPU for review and approval after executing the long-term contract with Commonwealth Wind for its project a month before.
At the beginning of this year, Iberdrola’s Avangrid Renewables took full ownership of the 1,232 MW project which was selected in December 2021 as part of Massachusetts’ third offshore wind competitive procurement process.
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