With authorized deadlines looming on the trail to extra clear power, Massachusetts has now misplaced three-quarters of the offshore wind capability as soon as in its pipeline after regulators allowed one other developer to again out of contracts for a significant set up.
The Department of Public Utilities authorized SouthCoast Wind’s proposal to pay utility firms a mixed $60 million and terminate contracts it beforehand reached overlaying a mixed 1,200 megawatts. The choice clears the way in which for the developer to hunt extra money for the clear energy that state officers are below huge strain to amass within the subsequent few years.
Like Commonwealth Wind, one other venture that efficiently backed out of its agreements for a 1,200-megawatt venture, leaders of SouthCoast Wind have stated they intend to submit a brand new bid within the subsequent spherical of procurement that closes in January.
Both builders have argued that due to altering financial situations, their tasks are now not financially viable below the contract phrases they struck with utilities. By backing out of the contracts and rebidding within the subsequent spherical, they’re playing that regulators will as soon as once more choose them from a small discipline of opponents, however this time at a better value.
SouthCoast Wind can pay $32.4 million to Eversource, $27.3 million to National Grid and $591,000 to Unitil below the termination agreements, and the utilities plan to credit score funds to ratepayers by means of contract changes.
All three members of DPU’s governing fee — James Van Nostrand, Cecile Fraser and Staci Rubin — signed the “stamp approval” for SouthCoast Wind’s termination agreements. They didn’t pen any commentary explaining their ruling, although one other state entity, the Department of Energy Resources, beforehand signaled its help for letting SouthCoast Wind out of its contracts with utility firms, saying the transfer would “allow for the project to seek viability through other means while preventing protracted litigation unlikely to produce additional ratepayer benefits.”
“That the SouthCoast Wind Projects are untenable under current market conditions is disappointing. DOER maintains that the successful development of offshore wind projects in the region is essential for a clean, diversified energy portfolio as well as providing greater opportunities for development of local supply-chain and offshore wind industry jobs in the Commonwealth,” officers at DOER, which like DPU is a part of the Executive Office of Energy and Environmental Affairs, wrote on Sept. 15.
“Approval of the Termination Agreements will help provide opportunity for the commercial success of the project. Additionally, DOER finds that the Termination Agreements consider ratepayer protections even under failed [power purchase agreements] with the return of over $60 million to ratepayers through each Company’s Long-Term Renewable Contract Adjustment. This provision effects short-term rate relief to the Commonwealth in exchange for the Projects’ lost opportunities.”