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United States

Iberdrola enters Cape Wind cost fight

US: A division of Iberdrola Renewables has joined Cape Wind Associates in fighting a demand for profit and costs estimates by Massachusetts's attorney general.

Cape Wind's meteological tower:  the first, and only,  US offshore construction
Cape Wind's meteological tower: the first, and only, US offshore construction

Developer Cape Wind Associates filed an official statement of opposition with the state Department of Public Utilities (DPU), responding to demands for profit and cost estimates.

DPU issued the demand following instructions from state attorney general Martha Coakley, as part of the department’s review of Cape Wind’s power purchase agreement (PPA) with utility National Grid.

Among the companies joining Cape Wind’s filing was Iberdrola Engineering and Construction. The Spanish company’s role in the project was not disclosed.

Other companies providing statements alongside Cape Wind Associates were:

  • Siemens Energy, which is providing 130 3.6MW turbines for the project.
  • Kiewit/Weeks/Cashman, which has been discussing engineering and construction contracts with Cape Wind.
  • Willis of Massachusetts, which is bidding to provide insurance advisory services.

Coakley’s filing said: "The Company has failed to produce responsive answers to information requests... [for] Cape Wind’s estimates of its ‘levelized’ cost of providing power under the proposed power purchase agreements ("PPAs") at issue in this proceeding, and Cape Wind’s estimates of its internal rates of return ("IRR") should the PPAs be approved."

She said that if Cape Wind opposes this demand, the department should prevent it from opposing Coakley’s own estimates of the project’s profit and costs.

But Cape Wind responded, in its own filing, that such figures are not relevant to the DPU investigation.

The developer has a PPA with National Grid for half of the project’s 468MW capacity.

The agreed price is $0.207/kWh with annual inflation adjustments of 3.5%, far more than the usual cost of onshore wind in the US.

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