Commonwealth Wind wants to back out of contracts

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Commonwealth Wind filed a motion to have the long-term contracts it entered into dismissed. — Courtesy Avangrid

Commonwealth Wind filed an 11-page motion on Dec. 16 with the Massachusetts Department of Public Utilities (DPU) to have several long-term power purchase agreement (PPA) contracts with several electric distribution companies dismissed. 

According to the Commonwealth Wind website, it is an offshore wind project owned by Avangrid, planned to be built in waters 22 miles south of Martha’s Vineyard, that would deliver “1,232MW of clean and affordable energy.” Its first grid interconnection location is in West Barnstable, with the potential for more connections in the state’s South Coast region. 

According to the motion, the contracts “do not meet the fundamental statutory threshold that they must ‘facilitate the financing of offshore wind energy generation.’”

“Unfortunately, despite diligent efforts by Commonwealth Wind to find a path forward for the project under the PPAs that did not necessitate dismissing these proceedings, the PPAs remain unable to meet this threshold requirement, and it does not appear that there is a viable pathway that would allow that threshold to be met,” the document reads. 

Commonwealth Wind suggested “offshore wind energy generation capacity currently included in the PPAs to be procured in the next solicitation,” which they would “bid into that solicitation and offer Massachusetts a project with cost-effective pricing, a superior timeline for completion, and exceptional economic development opportunities.” 

Commonwealth Wind claimed in the motion, “Dismissal also gives certainty to all stakeholders on the path forward,” since the state can move forward “without worry that the PPAs (and the

associated 1,200 MW of nameplate capacity) remain in limbo.”

Avangrid made statements in a press release that it is aware of Commonwealth Wind’s importance to green energy, and building the project remains its objective, but “Avangrid has been disappointed in the Electric Distribution Companies’ refusal to immediately engage on this matter.”

Other contractual parties were displeased with Commonwealth Wind’s request. “The Baker-Polito administration is disappointed by Avangrid’s request to the Department of Public Utilities to dismiss the review of the Commonwealth Wind contracts, but remains committed to the deployment of commercial-scale offshore wind and advancing clean, affordable energy on behalf of the commonwealth’s residents and businesses, while reducing greenhouse gas emissions and meeting the state’s emissions goals, including achieving net zero in 2050,” Massachusetts Executive Office of Energy and Environmental Affairs spokesperson Danielle Burney said in a statement. 

On Friday, Dec. 23, a letter was sent to DPU secretary Mark Marini by attorneys representing multiple electric companies that asked for Commonwealth Wind’s request to be denied. 

“Commonwealth Wind negotiated and executed comprehensive purchase power agreements with the companies that are now before the department for approval following a full and fair adjudicatory process. Approving the motion to dismiss at this very late stage would significantly undermine what to date has been a very successful process established in Massachusetts to encourage the development of offshore wind projects,” the letter reads. 

The companies listed in the letter included NSTAR Electric Co. (doing business as Eversource Energy), Massachusetts Electric Co. and Nantucket Electric Co. (doing business as National Grid), and Fitchburg Gas and Electric Light Co. (doing business as Unitil). 

“The three Massachusetts electric utilities selected these projects through a competitive process and negotiated these contracts in good faith with the offshore wind developers and various state agencies in accordance with all applicable laws and regulations. They were filed with the department as part of our responsibility to procure the energy supply needed to help the commonwealth achieve its clean energy goals and provide our customers with safe, reliable service. We remain ready to move forward with the contracts as filed,” Eversource spokesperson William Hinkle said.

17 COMMENTS

  1. Just the beginning of the end for wind energy. It certainly is a feel good commodity for the do gooders but it will never be profitable. Not making a profit has probably never been a concern for the type of people who love this project. They work for the government or so-called nonprofits. Real working class people realize this is a boondoggle and would probably be out on the streets protesting but , alas, they have to actually go to work in the morning.

    • John–I am impressed With your ability to take something, anything, and twist it in such a way as to imply that the “do gooders” are lazy slobs. That’s impressive. “They” are always looking for some sort of handout. “Real working class people”–IE, “conservative do badders” are much too busy working to bother with protesting about anything, except of course, the peaceful transfer of presidential power as mandated by the constitution.
      But I have faith that someday, once we become reliant on wind and solar power, the executives of those companies will be able to cite some real or made up national emergency and raise the price at will in order to gouge the working class,( and the lazy do gooders also of course) and become billionaires. And they will create jobs and everything will be fine.

      And while we are talking about the potential of new technologies,I wonder if you have ever heard of Fulton’s folly ?
      If not, perhaps you could take a few minutes out of your busy working day and read this:
      https://www.historyanecdotesforteachers.com/fultons-folly/
      Imagine that.

      • Fultons Folly with the invention of steamboats was great for industrialization. No one is arguing about how new technology advances life. The argument is ”at what cost?” New technology that gives one better efficiency at lower cost is welcome. Technology which is much more expensive and forced upon us due to some religious zeal about climate is unwelcome. Fossil fuels have lifted millions out of poverty in third world countries but taxing poor people with high costs for living due to some romantic vaguery of climate is not only bad form but dumb.

        • andy– I am amazed that you can look at history and not learn from it. As I have pointed out before, the Environmental Protection Agency came into existence in 1970 because it was obvious that we could not continue business as usual. Rivers such as the Delaware below Philadelphia were so polluted that nothing lived in it, and pilots could smell the stench when they flew over it at 5,000 ft. The Cuyahoga river in Ohio was so polluted that it repeatedly caught fire.  Citizens of major cities, had air quality that was so bad people literally died from it. People in Pittsburgh had to brush  the soot  off of their clothes before they could go into their houses, The ground was often not visible from the observation deck of the empire state building on sunny days.The smog was so bad in Los Angeles that people woke up one morning thinking they were victims of some sort of gas attack.
          https://timeline.com/la-smog-pollution-4ca4bc0cc95d
           London had smog so bad that up top 4,000 people directly died from it over a  5 day period in 1952. https://en.wikipedia.org/wiki/Great_Smog_of_London

           andy– tell me honestly that we were better off then than we are now.
          We have clean air and water because we did something about our ignorant and selfish pig attitudes. We  realized we were not entitled to just throw our waste anywhere we wanted regardless of the consequences.
          And you know what ? It cost money to clean all that Stuff up.  Billions of dollars of tax money were spent to clean up what would have cost thousands to prevent. Industries complied with the “regulations” and you grandkids can play in a field without worrying about it being so polluted that breathing the air will lead to early death.
          Should we all just throw our garbage out of the windows of our cars rather than take it to a place where it is properly handled. It would be cheaper after all.
          That would not only be bad form, but dumb.
          Can we agree even  on that point or are you resentful of littering laws?

      • andy– once again you cite the “they” and pontificate about what “they” want.
        I can only assume you are talking about those irrational conservatives who march to the drumbeat of fear of immigrants, the Chinese, antifa, BLM, the LGBTQ community, “cancel culture” CRT, and untrolled rampant crime in blue cities, as well as the federal debt (since we now have a dem president), to name a few of their phobias.
        These are the very same “they’s” that want the government to control the choices a woman can make about her body, who someone can marry, what types of surgery people may have, what bathrooms they can go into, what substances they may ingest, and increasingly, what books may be read in public libraries and schools.
        Yes, andy, you are absolutely correct— they ARE fearful of everything and love government control.

      • Everything is viable at a certain cost Mr Patterson. Do you know how much they pay for that wind power–the average joe blow? Please look it up and tell us you are ok with paying that.

        • andy– Most European countries don’t subsidize their oil companies like the U.S does. As a result, citizens of countries like France, which is in about the middle of gas prices in Europe are currently paying $6.50 U.S dollars per gallon, and 21.5 cents per KWH.
          The U.S. average is $3.41 per gallon and 17.5 cents per kwh, although I actually am paying 36 cents per KWH.
          Europe gets about 15 % of its power from wind, the U.S about 10%
          I don’t think it’s the price of wind power that is driving the overall price.

          This site is searchable for all sorts of energy prices:
          https://www.globalpetrolprices.com/France/electricity_prices/#:~:text=France%2C%20March%202022%3A%20The%20price,of%20power%2C%20distribution%20and%20taxes.

          In fact, Texas produces more wind power than any other state, and it’s residential electric rates are 11% lower than the national average .
          How about that ?
          One of us seems to have an erroneous opinion about the price of wind power or what drives the worldwide energy market.
          Is it ok for me to provide some facts ?
          I, of course, am open to debate, and am willing to be corrected.
          But your opinion may not convince me that my facts are wrong.

        • I’m would be just fine trading our government, regulatory and tax system with any Scandinavian country Andy. Our system sucks and only works for those with power and money which is why I suspect you love it so much.

  2. With the expected huge price increase in electric rates wind energy might finally become viable. I also suspect they want to break their contracts so they can negotiate a much higher rate return. But breaking contracts might doom them as well as the lower rates in their contracts if they don’t get want they want.

    • Mark- Did you notice that the Tisbury school contract was raised by nearly 50% 4 months after the contract was signed ?
      Inflation is impacting everything—
      The contractors for the school cited an increase in the price of steel. There is a lot of steel in this wind farm project.
      Would you expect them to just absorb that cost before construction ?

      • We expect them to write a contract they can fulfill and to anticipate what costs might be before signing. We should not hold someone harmless for something they don’t do. On the other side we expect govt of Tisbury to negotiate so that contract costs dont go up.

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