Cape Wind has all of the necessary permits to build the project. However, it only has a PPA with National Grid for 50% of the 468MW project and has been struggling to find a buyer for the remaining half to finance the build.
Nstar is to purchase 129MW of capacity from the project as of its $4.8 billion acquisition by Northeast Utilities. Cape Wind said this would allow the project to be constructed.
Last year, Cape Wind called on the Massachusetts Department of Public Utilities to make NStar/Northeast buy the remaining 50% in order to fulfil its renewables obligations. At the time, there was a question over whether this was possible as NStar has tended to prefer onshore wind and has acquired PPAs in several projects.
The decision brings to an end the search for project financing.Last year, there was speculation that Cape Wind 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. While at one point Siemens said it would consider financing the project.
Speaking about the decision, Cape Wind president Jim Gordon said: "Today's announcement by Governor Patrick represents a major step forward in making Massachusetts a leader in offshore wind power and attaining the jobs, clean air and energy independence benefits that Cape Wind will provide. By including Cape Wind in this utility merger Settlement Agreement, NSTAR and the Patrick Administration are helping ensure that Cape Wind will supply up to 500,000 homes with locally harvested renewable energy and create hundreds of new jobs."
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