Paper: Cape Wind energy prices high, not competitive with other green projects

THE BOSTON HERALD REPORTED THAT NATIONAL GRID commercial customers will be hit the hardest by Cape Wind energy prices while noting that other green energy projects have lower rates.
By PBN Staff
Posted 10/4/10

(Updated, 11:55 a.m.)

BOSTON – Prices for electricity from the Cape Wind energy project, the $2 billion offshore wind farm, may translate into businesses paying hundreds or even thousands of dollars more for energy, the Boston Herald reported Monday, noting that other renewable energy projects have more competitive prices.

National Grid sees its commercial and industrial customers paying 1.9 percent to 2.3 percent more for the Cape Wind energy, said the Boston Herald. Meanwhile, residential customers will pay about $1.25 more a month, according to Mass. Gov. Deval L. Patrick.

National Grid estimated a small grocery store or medium-sized restaurant will see electric bills rise by about $100 per month. A typical supermarket will pay about $500 more while a medium-size suburban hospital would see a $2,500 jump in its bills.

Large industrial businesses would get hit the hardest, the Boston Herald reported, noting that a business like Erving Mill, which uses 3.8 million kilowatts of electricity per month from National Grid, would see a $9,500 month hike.

The proposed Cape Wind rates are currently under review by state regulators but are much more expensive than land-based wind power available in Maine, New York and Canada.

“It is unconscionable for this administration to support Cape Wind, knowing its rate impact on National Grid ratepayers across Massachusetts, especially when equally green projects are available for almost half the price,” said Bob Rio, senior vice president of the Associated Industries of Massachusetts, to the Boston Herald.

The newspaper noted TransCanada, which owns 44 wind turbines in Maine, could sell its wind electricity for 41 percent less than Cape Wind’s 18.7 cents per kilowatt hour seen for the project’s first year in 2013.

National Grid has chosen to use Cape Wind’s energy because “it was the fastest and most efficient way to comply with renewable-energy quotas,” the Boston Herald reported. Cape Wind has a maximum of 468 megawatts while TransCanada’s Kibby Wind Farm in Maine can produce 132 megawatts.

The developer, Cape Wind Associates, said it is confident that Cape Wind’s prices will become competitive if fossil-fuel prices increase in coming years as expected and offshore development will ultimately drive down wholesale costs for all customers.

Spokesman Mark Rodgers told Providence Business News that the Herald’s account also compared “apples to oranges” when contrasting the costs of the Cape Wind farm to TransCanada Energy’s Kibby wind farm in Maine.

Rodgers said the infrastructure does not exist to carry electricity from Maine to Massachusetts at peak demand times. Rodgers also said drawing electricity from Maine would not create jobs or economic development locally, whereas the Cape Wind project would.

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