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DPU approves termination of offshore wind contract
Credit: Bruce Mohl | Aug 23, 2023 | commonwealthmagazine.org ~~
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The Massachusetts Department of Public Utilities on Wednesday approved without comment the termination of an offshore wind power purchase agreement negotiated between Eversource and Commonwealth Wind and approved by the DPU at the end of last year.
Avangrid, the developer behind Commonwealth Wind, sought the termination after it concluded rising inflation, supply chain disruptions, and the war in Ukraine had made it impossible to finance the project under the existing terms of the power purchase agreement.
The termination agreement was negotiated by Avangrid and the state’s three utilities in mid-July, along with a requirement that the wind farm developer pay a $48 million penalty that would be returned to ratepayers of the three utilities.
The DPU on Wednesday gave what is called stamp approval to Avangrid’s termination agreement with Eversource, which required a $25.9 million payment to that utility. Presumably, approvals for Avangrid termination agreements with National Grid and Until will be forthcoming shortly. The stamp approval came with no comment from the three DPU commissioners.
Approval of the termination agreement came on the same day the DPU approved the rules for the state’s next offshore wind procurement in 2024. That procurement will allow Avangrid to rebid its project again, presumably at a higher price, but it may be slapped with penalty points in the contracting process for signing the termination contract.
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