September 1, 2010

Divided Supreme Judicial Court clears Cape Wind

By Jon Chesto, The Patriot Ledger, 1 September 2010

BOSTON – The controversial Cape Wind project has proven to be such a divisive issue, even the state’s highest court can’t agree on it.

The Supreme Judicial Court sided with developer Cape Wind Associates on Tuesday by rejecting an appeal of a permit the state granted for transmission lines needed to run the proposed 130-turbine wind farm.

But the two justices on the SJC who dissented in the 4-2 vote said the ruling could have a widespread negative impact on communities in the state.

Although Cape Wind still needs a federal Army Corps of Engineers permit to build the turbines, the SJC ruling ends a quest for state permits that lasted nearly a decade.

“Today’s ruling is an important milestone,” said Jim Gordon, president of Cape Wind Associates. “We’re excited that we’ve been cleared for construction in Massachusetts.”

The Cape Wind issue ended up before the state’s highest court because opponents had sued to overturn the state Energy Facilities Siting Board’s 2009 approval of two transmission lines that would connect Cape Wind to the region’s electric grid. The opponents in this suit included the Alliance to Protect Nantucket Sound, the Cape Cod Commission and the town of Barnstable.

Alliance CEO Audra Parker called Tuesday’s ruling an “outrageous violation of community rights for towns throughout Massachusetts.”

The SJC ruled against all of the opponents’ arguments. For example, the high court ruled that the state siting board had the authority to grant a tidelands permit for the power lines, even though such a permit would normally only be granted by the state Department of Environmental Protection.

The SJC also said that because the Cape Wind project would be built in federal waters, the siting board did not have jurisdiction to consider the impacts that the wind farm would have on “in-state” areas. The board, the court ruled, was correct in only considering the impacts of the transmission lines within state borders. The SJC ruled that considering the effects of the turbines themselves on Cape Cod’s mainland would undermine the federal government’s authority over what happens in federal waters.

In the dissenting opinion, Chief Justice Margaret Marshall wrote that the SJC’s ruling establishes a dangerous precedent that could have far-reaching consequences, possibly opening the doors for other energy projects. Marshall, who was joined by Justice Francis Spina on the dissenting opinion, also wrote that failing to take into account the “in-state” consequences of a project in federal waters could have catastrophic effects on state tidelands and coastal areas.

The state permitting process may be over, but state officials do have a significant amount of power over the future of Cape Wind. That’s because the state Department of Public Utilities is currently weighing whether to approve a 15-year contract that calls for the sale of half of Cape Wind’s power to National Grid.

The state agency is expected to rule on the contract, which is considered essential for Cape Wind to get the financing that it needs to build the project, by sometime in November.

A number of politicians and business leaders have raised concerns about the cost of the contract, which would be passed on to National Grid ratepayers. National Grid wants to pay Cape Wind more than twice the current going rate for electricity. Because the wind power would represent just a small portion of National Grid’s overall electricity portfolio, the contract’s projected impact on a typical homeowner’s bill would be an extra $1.25 to $1.50 a month.

Parker said she’s optimistic that the state agency will realize ratepayers are being asked to pay too much to subsidize Cape Wind.

“Despite today’s ruling, if Cape Wind can’t sell its power because of the outrageous costs, they don’t have a project,” Parker said. “The tide has really turned against Cape Wind because of the high cost of this project.”

But Gordon said his company will play a role in keeping electric costs down in the long run by helping to wean the region off its significant reliance on fossil fuels for electricity generation. “We’re confident that the results will show that Cape Wind is going to provide significant value to electricity consumers,” Gordon said.

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