Cape Wind requests compulsory PPA on utilities merger

UNITED STATES: Cape Wind has asked the Massachusetts Department of Public Utilities to make the merger of two utilities NStar and Northeast Utilities conditional on signing a power purchase agreement with the wind farm.

Cape Wind has a PPA with National Grid for 50% of the 468MW project and has been struggling to find a buyer for the remaining half. The developer has permits in place for construction of the project.

Now, Cape Wind has written to the state regulator requesting NStar/Northeast buy the remaining 50% in order to fulfil its renewables obligations. However, NStar has acquired PPAs in onshore projects.

Although Cape Wind has all the relevant permits for the project, it has been struggling to acquire the necessary finance for the project.

Earlier this year, there was speculation that the company may tap into the bond market for financing. The move followed a decision by the Department of Energy to shelve the company's application for a loan guarantee for the $2 billion project.