Cape Wind has yet to announce it has lined up financing to pay for the massive project they are proposing to build in Nantucket Sound, a delay that has critics hopeful the project will never get off the ground.
Cape Wind for its part isn’t saying anything, but public records obtained by FOX Undercover show the would-be wind farm builders are asking the federal government for help in the way of a loan guarantee they need to help get loans.
“Their project has had tremendous difficulty getting financing,” claimed Audra Parker, president and CEO of the Alliance to Protect Nantucket Sound, Cape Wind’s main opposition.
Parker hopes that Cape Wind can’t find lenders to help pay the more than $2 billion it will take to build 130 wind turbines, each one rising more than 400 feet out of Nantucket Sound.
Cape Wind at one point said they would have no problem borrowing money to build the wind farm if the Massachusetts Department of Public Utilities approved generous agreements with power companies. Those agreements would essentially give Cape Wind guaranteed customers locked in at high rates.
A Cape Wind official told state regulators in Aug. 2012 that the agreement “…would be sufficient to finance the project,” a transcript of his testimony shows.
But Cape Wind told another story earlier to the federal government, where it’s looking for a taxpayer-backed loan guarantee.
Redacted copies of those applications to the U.S. Department of Energy for the guarantee were obtained by FOX Undercover under the federal Freedom of Information Act.
“(L)ittle or no financing may be available for the Cape Wind project.” Cape Wind wrote in 2009.
“The DOE loan guarantee will enable the funding…,” Cape Wind wrote in Sept. 2010.
“Cape Wind is financeable,” read another document submitted in Sept. 2010. “(W)ith the Department’s guaranty, Cape Wind can be in construction in 2011.”
The loan guarantee has yet to be acted on. The U.S. Department of Energy did not respond to a request for comment.
“Despite the fact that they have this contract, they have a $4 billion premium that you and I every business owner in Massachusetts would have to pay, they still can’t get financing, they need federal subsidies in addition to that, they need a loan guarantee. It just doesn’t make sense,” said Parker.
It does make sense to some, though. While Cape Wind wouldn’t comment for this story, supporter George Bachrach of the Environmental League of Massachusetts did.
“There’s a huge public policy reason behind having clean renewable energy. It’s called climate change,” Bachrach said.
FOX Undercover reporter Mike Beaudet asked Bachrach why he thought Cape Wind was seeking a federal loan guarantee.
“Why does the fossil fuel industry have 100 years of government subsidies? Because if you’re going to drill for oil not every hole is going to come up oil,” Bachrach said, adding that he would expect a private enterprise to seek every benefit it could.
Earlier this year, Cape Wind announced it had secured $200 million in financing from a Danish pension fund. In earlier filings with the Department of Energy, Cape Wind and its supporters say some of the difficulty in getting financing is because this would be the first off-shore wind farm in the U.S., so lenders here aren’t as familiar with projects as they are in Europe.
“Is Cape Wind having trouble getting financing?” Beaudet asked Bachrach.
“No. Cape Wind to the best of my knowledge is going just fine,” Bachrach replied. “It’s interesting the people that are claiming that Cape Wind is having financing problems, how would they know? Have they seen the books? Of course not.”
“When will this project be built?” Beaudet asked him.
“I think it’s going to be built when they say it’s going to be built, which is probably starting construction in 2014 and hopefully getting done a year later or so,” Bachrach replied.
But opponents aren’t so sure.
“How long will this battle go on?” Beaudet asked Parker of the Alliance to Protect Nantucket Sound.
“Until we win,” she replied
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