Cape Wind’s bid for government loan backing has been put on hold, potentially removing a key source of financing for the controversial offshore renewable-energy project.
The U.S. Energy Department has decided to focus on applications that can be processed by Sept. 30, the expiration of the agency’s loan-guarantee program.
Experts say Cape Wind, the nation’s first offshore wind project, will have a harder time lining up financing without federal backing.
“As a DOE loan guarantee would substantially reduce costs to Massachusetts electricity consumers, Cape Wind will continue to pursue the matter,” developer Cape Wind Associates said in a statement to Bloomberg News.
The $2.6 billion project – which secured a final federal permit for its construction and operation plan last month, a decade after it was first proposed – calls for 130 turbines in Nantucket Sound.
The developer is still trying to find a buyer for half of the 468-megawatt Cape Wind’s power, with only National Grid on board.
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