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AG’s report details cost of Cape Wind power
Credit: By Beth Daley, Globe Staff, The Boston Globe, www.boston.com 21 August 2010 ~~
Translate: FROM English | TO English
Translate: FROM English | TO English
Consultants hired by the state attorney general made public yesterday a more revealing assessment of the price for energy from the Cape Wind project: an average of 23 cents per kilowatt hour a year for the wind farm’s first 15 years.
Cape Wind, the utility National Grid, and state officials have said the project will cost 18.7 cents per kilowatt hour in the first year, but there is a 3.5 percent annual price escalator built into the proposed contract to sell electricity from the energy project.
The contract price is significantly higher than today’s cost of electricity.
The new figures were part of an 85-page document the attorney general’s office filed yesterday with the state Department of Public Utilities, making a detailed case for why its negotiated price for Cape Wind power, which was knocked down 10 percent from the original 20.7 cents per kilowatt hour, was a fair one.
Testimony from an energy consultant will be used by state utility officials to help determine whether the price is a fair one for consumers. The contract between Cape Wind and National Grid needs the utility department’s approval.
According to the documents, the project will cost more than $2.5 billion to construct, not including operations, maintenance, or financing.
The documents also offered more information to show that the price compares well with other offshore wind projects in the United States. The price is “somewhat higher’’ than prices expected in Europe, however.
“We were pleased that we were able to save ratepayers between $400 million and $600 million over the original contract terms,’’ said Attorney General Martha Coakley, “and shift some of the risks of the contracts from ratepayers to Cape Wind, while allowing customers to share in any further cost savings.’’
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