Library filed under Impact on Economy from Massachusetts
The report, which was Coakley's official justification of her rate settlement with Cape Wind and National Grid, includes "redacted" words, numbers, sentences, paragraphs and charts. It even blanked out a question asked of an energy expert hired by Coakley's office - and the expert's response was also crossed out, records filed with the Department of Public Utilities show.
What fool would undertake a $9.5 mil wind generator project having no previous experience with such things, with unproven and unknown revenue returns, all the while subjecting the town to the very certain liability of $1 mil a year in P&I costs without planning to offset that liability with adequate additional reserves?
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.
Under the revised contract, National Grid electricity customers who use an average of 600 kilowatt hours of power a month would pay just under $1.50 more on their electric bills in 2013, when the contract begins ...Associated Industries of Massachusetts, a trade group that has long been skeptical of Cape Wind, remained unswayed by the price reductions.
The issue is that pursuit of the goal has the potential to convert thousands of acres of the state's land and water into industrial tracts - all for the purpose of generating low quantities of expensive and unreliable electric power. This may be acceptable in the Midwest with its open agricultural spaces, but in Massachusetts will likely mean the destruction of forested lands and scenic vistas.
In May, Cape Wind Associates LLC reached an agreement with National Grid to sell half the power generated by the wind farm for 20.7 cents per kilowatt hour. Under the "agreement in principle" announced yesterday by Massachusetts Attorney General Martha Coakley, the cost of energy in the proposed 15-year contract would drop to 18.7 cents per kilowatt hour.
"The settlement circumvents what should have been an open and transparent review by the Department of Public Utilities of the largest electricity rate case in recent memory. We had hoped that the attorney general would be a stronger advocate for the interests of financially struggling employers and citizens of the commonwealth.
A Canadian power company is laying the groundwork for a major legal battle with the Bay State over what it's calling a "tainted" process for signing renewable-energy contracts. Industry experts warn that TransCanada Power could soon challenge the constitutionality of National Grid's controversial deal with Cape Wind Associates.
The fix is in. Our governor has allied himself with the wealthy private developer and the big foreign utility National Grid, which stands to reap hundreds of millions from bloated electricity rates Cape Wind will saddle consumers with. Like the Big Dig, which Massachusetts politicians used like an ATM for decades, Deval Patrick has reaped the rewards with huge campaign contributions.
"We think that the underlying construction and operation costs of Cape Wind and profits to the project's investors are relevant to whether National Grid's contract with Cape Wind is cost effective and in the best interests of Massachusetts ratepayers. We have requested that the Department of Public Utilities order Cape Wind to provide this information."
Robert Rio, senior vice president at Associated Industries of Massachusetts Inc., said he expects the organization to "add a perspective that is very important to determining the outcome of the proceeding...This is now more transparent, as transparent as it could be." Rio said the group is looking to fully understand the costs of Cape Wind power "and see if this is the best way to use ratepayer money."
A new report on the financial threat posed by Cape Wind to consumers makes it even more clear that Attorney General Martha Coakley is taking the right steps by demanding more answers about the true cost - and true profits - of this beleaguered project.
Participants in the small-vessel commercial fishing business need some scientific basis for a management plan that will keep them in business and keep the species they harvest healthy. Fishermen have often come late to the game, without the data necessary to counter the information that the regulators mistakenly believe tells the entire story.
In filings with the state, Wal-Mart said the high prices set by Cape Wind's first contract to sell electricity will lead to higher costs for the retailer. Wal-Mart already pays more than $2 million a year to power 28 Massachusetts stores served by National Grid, which negotiated the deal with the offshore wind farm.
Consumers will have to pay at least $1.4 billion above market rates for electricity generated by the controversial Cape Wind project, new projections show. ...Now the estimates are in: $700 million to $1 billion extra, even after calculating in so-called "suppression-price savings" provided by National Grid.
Opponents of the Cape Wind project are planning to launch a multi-pronged legal attack that could include a challenge to the constitutionality of a state law forcing utilities to buy much of their renewable-energy only from firms that produce power within Massachusetts. The possible legal assault, based on the Commerce Clause of the U.S. Constitution, would be in addition to opponents' already stated intent to challenge Cape Wind on alleged violations of endangered species, ocean and energy laws.
The highly touted Cape Wind project is already stoking fears of an open-ended ratepayer burden and lack of accountability reminiscent of the state's Big Dig nightmare. As the Herald reported yesterday, the Cape Wind project, which started out as a $650 million offshore wind farm, has ballooned to more than $2 billion in construction costs and a potential $6 billion hit to ratepayers when debt service, profits, maintenance and other costs are included.
The ferocious opposition from Massachusetts liberals to the Cape Wind project has provided a useful education in green energy politics. And now that the Nantucket Sound wind farm has won federal approval, this decade-long saga may prove edifying in green energy economics too: Namely, the price of electricity from wind is more than twice what consumers now pay.
The current price of National Grid's non-wind electricity is now about 9 cents per kilowatt. That means the cost of fossil-fuel generated electricity would have to increase nearly four-fold just to keep pace with Cape Wind's prices over the next 15 years. "I'm glad it's your electric bills and not mine," said Robert McCullough, president of McCullough Research, an Oregon energy consulting firm, referring to Cape Wind's prices.
After more than five months of negotiations, the state's largest electric utility has agreed to buy half the power generated by what could be the country's first offshore wind farm. Under the deal, National Grid will pay 20.7 cents per kilowatt hour for the power from the 130 turbines that Cape Wind Associates LLC wants to build in Nantucket Sound and for renewable energy credits associated with the project.