December 14, 2010

Cape Wind foes ask SJC to reject power deal

By Patrick Cassidy, Cape Cod Times, 14 December 2010

Industry advocacy groups, a Canadian energy company and longtime opponents of the proposed Nantucket Sound wind farm have filed appeals with the Massachusetts Supreme Judicial Court seeking to overturn the state’s approval of a power agreement between Cape Wind and National Grid.

Associated Industries of Massachusetts, TransCanada Corp., New England Power Generators Association Inc. and the Alliance to Protect Nantucket Sound filed separate but similar appeals with the court Friday opposing the deal.

The groups argue in their appeals that the state Department of Public Utility’s approval of the power purchase agreement for power from the proposed wind farm is “based on errors of law, lack of substantial evidence in the record and requisite subsidiary findings, is arbitrary and capricious and an abuse of discretion, or not otherwise in accordance with law.”

In November the DPU approved a deal between Cape Wind and National Grid for half the power from the project’s 130 turbines.

Under the agreement, National Grid would pay 18.7 cents per kilowatt-hour for the energy and other commodities related to the project. For an average residential electric customer in the utility’s territory, Cape Wind’s power will cost an additional $1.50 on a monthly bill for 618 kilowatt-hours of electricity, according to National Grid’s calculations. The cost of the contract would increase 3.5 percent annually.

National Grid distributes electricity on Nantucket and in other parts of the state but not on Cape Cod and Martha’s Vineyard.

Opponents of the agreement contend that Cape Wind should be required to compete with other sources of power that are less expensive, including out-of-state power generators.

The deal, which is the first long-term power purchase agreement approved under the state’s 2008 Green Communities Act, violates the Commerce Clause of the U.S. Constitution, according to the appeals.

DPU’s order also violates the state’s Electric Restructuring Act of 1997 because it allows National Grid to charge customers for Cape Wind’s power who choose to buy power elsewhere, said Associated Industries of Massachusetts Senior Vice President Robert Rio.

“It really goes to who pays the above-market costs of the Cape Wind power,” Rio said. “They get no benefit from Cape Wind and yet they’re paying for it.”

Despite the slew of appeals, Cape Wind and National Grid officials said Monday that they are confident the DPU approval will hold up in court.

“We have said repeatedly that we cannot let this project pass us by if we are to take seriously the renewable-energy requirements set forth in Massachusetts and the region at large,” said National Grid spokeswoman Jackie Barry.

This is not the first time the Supreme Judicial Court will have a say in Cape Wind’s future.

In August the state Supreme Judicial Court rejected a challenge of a permit issued for Cape Wind by the state Energy Facilities Siting Board. In 2006 the court upheld the siting board’s approval of a pair of cables that would connect the turbines to the electric grid.

Following a series of state and federal regulatory victories, legal and financial challenges are all that remain for the controversial project first proposed in 2001.

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