September 8, 2010
Massachusetts

Shrinking Cape Wind: Project may be cut unless more power-buying deals made

By Jay Fitzgerald, Boston Herald, www.bostonherald.com 8 September 2010

Cape Wind will be forced to build fewer than its projected 130 turbines on Nantucket Sound if it can’t find enough buyers for its electricity – and that would increase its cost to ratepayers, new state filings and public testimony show.

While a smaller offshore wind project might ease the concerns of some Cape Cod residents worried about their waterfront views, it would lead to even higher prices for National Grid customers.

Cape Wind Associates president Jim Gordon insisted yesterday that a full build-out of 130 giant turbines remains his goal.

But regulatory filings by Attorney General Martha Coakley, National Grid and others show that authorities are already planning for the possibility that all 130 turbines might not be built.

Coakley’s office has estimated that customers of National Grid, which has agreed to buy 50 percent of the electricity produced by Cape Wind, could see their base rate prices jump from 18.7 cents per kilowatt hour to about 19.3 cents if the other half of the proposed project’s electricity isn’t sold to other utilities.

In addition, construction of all the 130 turbines could take years longer if more buyers for the electricity aren’t found soon.

Nstar, the state’s other large electric utility, has made clear it doesn’t want to buy power from Cape Wind due to its high costs.

Glenn Benson, an attorney for the Alliance to Protect Nantucket Sound, spent much of yesterday’s Department of Public Utilities hearing – the first of many sessions this month – hammering Cape Wind officials about how much of the project might be built and when.

Dennis Duffy, vice president of Cape Wind, conceded that a proposed contract with National Grid calls for a hike in rate prices if the second half of the project isn’t built. He declined to say which turbines on Nantucket Sound might not be built.

But Duffy said Cape Wind has financial incentives to build all 130 turbines due to economies of scale and fixed costs that make the project more profitable if more turbines are built.

“We absolutely will try to build the largest project possible,” Duffy said during DPU testimony yesterday.

A smaller-scale project wouldn’t affect federal and state permits for the project because there’s no minimum amount of turbines that must be built, just a cap on the maximum number of turbines at 130.

URL to article:  https://www.wind-watch.org/news/2010/09/08/shrinking-cape-wind-project-may-be-cut-unless-more-power-buying-deals-made/