Cape Wind Associates LLC, the developer of a 468-megawatt wind farm off the coast of Massachusetts, said regulators approved a power sales contract with utility Nstar, bringing the project one step closer to financing.
The Massachusetts Department of Public Utilities today approved the 15-year power purchase agreement for 129 megawatts of the offshore wind farm’s capacity, Cape Wind said in an e-mailed statement. The Boston-based developer has a separate deal with National Grid Plc for half of the project’s output that was upheld by the Massachusetts Supreme Judicial Court in December.
Construction on the wind farm, which will use Siemens AG turbines, has been planned for more than a decade and may begin as early as next year, Cape Wind said on June 26. Approval of the second power purchase agreement will help the company secure financing, Mark Rodgers, a spokesman, said today by e-mail.
“We are moving forward on project financing for the two PPAs we have in place for 77.5 percent of the project,” Rodgers said. “We are optimistic we will be able to sell additional power, and we will seek additional financing for those turbines at that time,” he said.
He declined to comment how much the first segment of the project, consisting of 101 turbines, will cost. Both contracts have provisions that “help enable the project to secure financing” if a federal tax credit that provides wind-power producers 2.2 cents a kilowatt-hour expires Dec. 31, Rodgers said.
Northeast Utilities on Feb. 15 received approval to buy Nstar, and the Cape Wind contract was part of a settlement with Massachusetts regulators that reviewed the purchase.