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Massachusetts businesses challenge Cape Wind PPA

UNITED STATES: Cape Wind’s PPA with National Grid has come under renewed pressure following a legal challenge from a Massachusetts business group.

The Cape Wind meteorological tower, the first part of the project to be built
The Cape Wind meteorological tower, the first part of the project to be built

The Associated Industries of Massachusetts (AIM), which claims to represent 6,000 industries in the state, is challenging the PPA in the state’s Supreme Court.

AIM says:

The contract was not competitively bid. AIM believes the intent of the Green

Communities Act requires a competitive solicitation for renewable power contracts.

The amount of the Power-Purchase Agreement exceeds 3 percent of National Grid’s load.

National Grid’s ratepayer allocation of the above-market costs of Cape Wind is inconsistent with the law and harms ratepayers on competitive energy supply.

The Cape Wind PPA, which covers half of the 468MW project’s output, was signed off by the Massachusetts Departments of Public Utilities last month.

The price for the PPA is USD0.18/kwh in 2013, rising by 3.5% annually for 15 years. National Grid then has a right to a one-time, ten-year extension of the contract.

The price can be adjusted up and down based on various contingencies, such as if Cape Wind is unable to secure certain federal subsidies.

The DPU said the contract is cost-effective, arguing that its benefits far exceed its costs.
DPU chair Ann Berwick said: "It is abundantly clear that the Cape Wind facility offers significant benefits that are not currently available from any other renewable resource."

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