By Michael T. Burr

UPDATE: Friday, May 7, 2010:

Cape Wind just signed a 15-year contract under which National Grid will purchase 50 percent of the wind farm’s output — including electricity and renewable energy certificates “and other potential market attributes.” National Grid agreed to pay a tariff that starts at 20.7 cents a kilowatt hour and escalates at 3.5 percent each year, assuming federal tax incentives remain in place.

If the Massachusetts Department of Public Utilities approves the contract, National Grid expects it will add $1.59 to customers’ monthly bills. The deal is expected to satisfy the utility’s state-mandated requirement to procure 3 percent of its total electricity supplies from renewable sources.

Whether the DPU will approve the deal remains to be seen. The Rhode Island PUC recently balked at the price tag of a similar deal that would’ve had National Grid buying power from a different offshore wind project for 20 years starting at 24.4 cents per kWh.-MTB

ORIGINAL APRIL 21 POST:

This message from National Grid just hit my inbox:

>>

Please find enclosed a statement from Tom King, president, National Grid, on today’s historic decision by U.S. Secretary of the Interior Salazar on the Cape Wind project and the status of National Grid’s negotiations with Cape Wind on a power purchase agreement:

“We congratulate Cape Wind on the approval of its project.

Secretary Salazar’s decision marks an historic step forward for energy policy in the United States, our region and the Commonwealth of Massachusetts. State and federal renewable goals can only be met with an open-minded attitude to energy alternatives. This bold step by the Obama administration sends a signal that the United States is serious about securing its energy future and is willing to take action to make that happen.  We also applaud the vision of the Patrick administration in recognizing the critical importance of this project to the state, the northeast and the nation.

National Grid is a long-time advocate for the development of renewable energy sources as a means to mitigate climate change, increase domestic energy supplies, and benefit customers and communities by providing a cleaner, more secure energy future.  That is why we have been working to negotiate a power purchase agreement with Cape Wind.  Our negotiations are going very well and we are optimistic that we will have more to say about our progress in the near future.”

>>