Rhode Island offshore wind project wins key court ruling
Charlottesville, Virginia (Platts)--5Jul2011/632 pm EDT/2232 GMT
Deepwater Wind, one of three developers in the Northeast vying to build
the US' first offshore wind farm, has won a key court ruling for its 28.8-MW
project off the coast of Rhode Island.
The Rhode Island Supreme Court on Friday rejected arguments from two
manufacturers that National Grid will pay too much for power from the Block
Toray Plastics and Polytop challenged the state Public Utilities
Commission decision approving the utility's 20-year deal to buy the power at
an opening price of 24.4 cents/kWh with a 3.5% annual escalation.
The favorable court decision paves the way for the $250 million
Deepwater Wind project to seek state and federal permits.
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Jim Lanard, president of the Offshore Wind Development Coalition, said
that the other two offshore wind projects closing in on the finish line are
Cape Wind's 420-MW project off Cape Cod, Massachusetts, and the Fishermen's
Energy 24-MW wind farm off of Atlantic City, New Jersey.
All three developers are trying to complete a different set of final
milestones, according to Lanard.
Deepwater has a buyer for its power and financial backers, but needs to
secure permits. Fishermen's Energy has permits, but needs to secure a revenue
stream for its power. Cape Wind, by far the largest project, has a buyer for
half its power and has its permits, but now needs financing. Cape Wind also
must ward off litigation from opponents.
"The offshore wind industry has momentum," Lanard said. "We are
beginning to move in the right direction with projects that are getting
closer to being able to be financed and built."
Deepwater Wind said it plans to begin site preparation in 2012, and
hopes to have the Block Island wind farm operating in 2013 or 2014. The
project must first secure permits from the US Army Corps of Engineers and the
Rhode Island Coastal Resources Management Council, according to Meaghan Wims,
a Deepwater Wind spokeswoman.
In its 75-page decision, the Rhode Island Supreme Court said the PUC
acted according to state law when it approved National Grid's power purchase
agreement with Deepwater Wind.
"We are disappointed with this ruling which approved what we believe was
an unreasonable PUC majority decision and will cost RI electric ratepayers
about $400 million, said Mike McElroy, Toray Plastics and Polytop's attorney.
"This project will create only six permanent jobs, but we believe the
huge additional electric costs it will impose, especially on businesses, will
significantly discourage growth in RI's sluggish economy, which is struggling
to overcome a deep recession," he added.
The developer, however, expects the project to inject over $100 million
in economic activity into the state and create about 200 construction jobs.
--Lisa Wood, email@example.com