Nearly a decade and a half after it was first proposed, America’s first commercial offshore wind project, Cape Wind, could be on its last legs.
Yesterday, National Grid and NSTAR, the two companies that agreed to buy electricity from Cape Wind, said they were scrapping their power purchase agreements with the developer. Those agreements accounted for more than three-quarters of the 468-megawatt project’s projected output.
The project is planned for Nantucket Sound, located off the coast of Massachusetts.
Citing the passage of "critical milestones" set for December 31, a Northeast Utilities spokesperson told the Boston Globe that the developer had failed to pledge collateral as a way to extend the legal agreement between the utilities and Cape Wind.
"Cape Wind has chosen not to exercise their right to post financial security in order to extend the contract deadlines. Therefore the contract is now terminated," said Northeast Utilities’ Caroline Pretyman, speaking to the Globe, about subsidiary NSTAR’s decision.
"National Grid is disappointed that Cape Wind has been unable to meet its commitments under the contract, resulting in yesterday’s termination of the power purchase agreement," said Jake Navarro, a National Grid spokesperson, in an emailed statement to Greentech Media.
The National Grid contract, signed in 2010, was for half of Cape Wind’s electricity. The contract with NSTAR, signed two years later, was for 27.5 percent of the electricity.
In an e-mailed statement, Cape Wind representative Mark Rogers said that the company would "pursue every option available to us" in order to move the project forward. He cited a "Force Majeure" provision in the PPA that extends milestones if an "unusual, unexpected and significant event" occurred outside the control of Cape Wind.
That "event" was the onslaught of litigation from the Alliance to Protect Nantucket Sound, a group of local wealthy property owners who spent millions of dollars over the years to stop Cape Wind.
In a letter penned to National Grid and NSTAR on December 31, Cape Wind President Jim Gordon lamented that "extended, unprecedented and relentless litigation" from the Alliance prevented the developer from closing financing, as required in the PPA.
"It has been completely beyond Cape Wind’s control and could not have been prevented or avoided. In fact, Cape Wind has undertaken herculean efforts to negate the impact of such litigation and, at every turn, has been successful. Despite this, the relentless litigation has undeniably slowed the development of Cape Wind’s project and interfered with the timely financing of the project," wrote Gordon.
Despite fierce legal opposition over the years, Cape Wind has been achieved numerous positive milestones, including securing federal permits and the two PPAs in 2010 and 2012. But the twenty court challenges bought by the Alliance delayed the project just enough to cause Cape Wind to lose its contracts.
Cape Wind has sparked a small class war in Massachusetts. Advocates of the project label the Alliance to Protect Nantucket Sound as a group of rich, insulated elites — including the third Koch Brother, Bill — who are paying tens of millions of dollars to stop a project that could protect ratepayers from fluctuating power prices in the state.
In 2007, Wendy Davis wrote a book on the conflict titled, "Cape Wind: Money, Celebrity, Class, Politics and the Battle for Our Energy Future." Her description of the tactics used by the Alliance to Protect Nantucket Sound helped define the group as elitist and out of touch in the eyes of Cape Wind supporters.
"This melodrama…was a very well-orchestrated show whose paymasters had immense resources. It was all very much in keeping with the previous three years, during which the Alliance had been engaged big time in creating a parallel universe, a virtual reality, their own Hollywood storyline, about Gordon’s project, about Nantucket Sound and about the environmental and energy issues facing Cape Cod, New England and all of America."
But it wasn’t just the Alliance doling out millions for their cause. Cape Wind’s Jim Gordon has reportedly spent $70 million of his own money to support the project — making it more of a war between the wealthy. The Alliance labeled Jim Gordon as a subsidy hog who would drive up power prices for hard working people in Massachusetts.
In a statement, the Alliance celebrated the termination of Cape Wind’s contracts, confident that it had finally won.
"For the fishermen, homeowners, towns, pilots, businesses, Native Americans, and visitors to Cape Cod who have opposed this project for 14 years, this news may finally mean the end of the long fight to save Nantucket Sound from industrialization."
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