PROVIDENCE - National Grid is willing to resume negotiations with Deepwater Wind over a power-purchase agreement if certain conditions are met first, according to a letter from the utility to the offshore wind farm developer.

The primary stipulation is that Deepwater must commit to a price that increases at a consistent annual rate and is not subject to other variables, such as potential delays or other complications that could raise the cost of the developer's plan to install up to eight turbines off Block Island.

The letter, which was filed with the state Public Utilities Commission on Wednesday, follows National Grid's decision Oct. 15 to reject a proposed agreement with Deepwater, because, the utility argued, the price to purchase the electricity generated by the small wind farm would be prohibitively high.

National Grid calculated the price to be 30.7 cents per kilowatt-hour, more than three times the price of electricity from conventional sources, according to filings with the PUC. In interviews last week, Deepwater executives said the price would be lower - between 20 cents and 25 cents per kilowatt-hour - and would increase by 3.5 percent each year.

National Grid maintains that although that pricing range was published in the media after talks broke down, Deepwater never submitted it formally during negotiations.

"While we cannot promise that we would necessarily support a new proposal at the stipulated pricing, given the fact that 20 to 25 cents per kilowatt-hour is still quite high, we certainly would consider and evaluate it," wrote Madison N. Milhous Jr., National Grid's director of wholesale market relations, to Deepwater chief executive officer William M. Moore.

Even after talks were suspended, Moore and Paul Rich, Deepwater's chief development officer, said they were committed to working out a deal with National Grid. A power-purchase agreement is crucial for Deepwater to attract additional financing.

On Thursday, Moore issued a statement through a spokeswoman but would not comment specifically on National Grid's letter or whether Deepwater would agree to the conditions proposed by the utility for talks to continue.

"We look forward to resuming negotiations with National Grid, with the goal still in mind of reaching an agreement that's in the best interests of Rhode Island ratepayers, the environment and the growth of a new, "green" industry that will bring hundreds of new jobs to Rhode Island," he said.

National Grid made the filing last week with the PUC to meet a deadline set by a new energy law signed by Governor Carcieri in June. The law, for the first time, requires Rhode Island's largest utility to enter into "commercially reasonable" agreements with renewable-energy providers.

It stipulates that National Grid must first work out a contract for a developer to supply green energy to Block Island, which relies on diesel generators, and then sign a more long-term pact for providing alternative power throughout the state.

Deepwater was the only developer to apply for the Block Island contract. The New Jersey-based company plans to install between six and eight turbines three miles from Block Island by 2012 and then follow that demonstration project by building a wind farm with about 100 turbines at least 15 miles off the Rhode Island shore. The total cost of the projects is estimated to be $1.5 billion.