March 18, 2011
Massachusetts

NStar asks to keep wind power costs from public

by Kyle Alspach, Boston Business Journal, www.bizjournals.com 17 March 2011

NStar wants to avoid public disclosure of the price it’s seeking to pay for electricity from three New England wind power projects.

The Boston-based utility is asking state regulators to keep the contract price terms confidential, according to filings with the Massachusetts Department of Public Utilities.

NStar has expressed no interest in buying power from Cape Wind, the planned offshore wind project in Nantucket Sound, citing the price of the power. The utility is instead seeking to buy power from smaller land-based wind farms in Massachusetts, Maine and New Hampshire, and has referred to each of the projects as a “cost-effective renewable resource.”

The Massachusetts wind farm – the Hoosac Wind Energy Project – is located in the towns of Monroe and Florida and would produce 28.5 megawatts of power.

In filings with the DPU, NStar said revealing the price of the power from Hoosac and the other wind farms would harm the “effectiveness and competitiveness of future competitive solicitations for renewable energy.” The price of the power would include both the actual electricity and associated renewable energy credits.

NStar is also asking that its bidders for the contracts are not publicly disclosed, saying the disclosure could make bidders more reluctant to submit bids in the future, or may lead to inflated bids.

The state Green Communities Act mandates utilities get an increasing percentage of their electricity from renewable sources, rising 1 percent a year to reach 25 percent by 2020.

NStar is facing pressure from the administration of Gov. Deval Patrick to make more investments into renewable energy as the company seeks state approval of a merger with Hartford-based Northeast Utilities. Last week, the DPU approved the use of a tougher standard of review for the current merger and all future utility mergers, which could include a look at whether the merger would help to meet state environmental and clean energy goals.

The Hoosac project, developed by major Spanish wind firm Iberdrola S.A, is expected to begin operation in July 2012, after being delayed by litigation and local opposition since 2004.

The New Hampshire wind farm, the Groton Wind project in Groton, is also being developed by Iberdrola, while the Maine wind farm, the Blue Sky East project in Eastbrook, is being developed by Boston-based First Wind Holdings Inc.

NStar has objected to buying offshore wind power from Cape Wind on the grounds that the price is too high. The project’s rate of 18.7 cents per kilowatt hour – more than double the normal rate from fossil fuel power —has sparked major debate about the cost of renewable power and whether ratepayers should be asked to subsidize it.

Utility National Grid has agreed to buy half of Cape Wind’s power at that rate.