US government signs lease with energy firm for Mass. offshore wind farm, nation’s first

Wednesday, October 6, 2010

US government signs lease with Cape Cod wind farm

BOSTON — The developers of a wind energy project off the Massachusetts coast, the nation’s first offshore wind farm, signed a 28-year lease with the federal government Wednesday.

The lease will cost Cape Wind Associates LLC $88,278 in annual rent prior to production, and a 2 percent to 7 percent operating fee once it starts making electricity.

U.S. Interior Secretary Ken Salazar and Cape Wind officials signed the lease at a meeting of the American Wind Energy Association in Atlantic City, N.J. In April, Salazar approved the 130-turbine project following more than eight years of federal review.

Seth Kaplan of the pro-Cape Wind environmental group, the Conservation Law Foundation, said the crowd in the convention hall rose to its feet to cheer the announcement. After such a difficult battle for approval, it was a “huge moment” to see concrete steps taken on a project that will help establish a new U.S. clean energy industry and battle global warming, Kaplan said.

“It’s the beginning of something,” Kaplan said. “When I sit down and look at what we need to do to save ourselves, save our environment, save our economy, this is the beginning.”

When completed, Cape Wind will cover 25 square miles in Nantucket Sound. It’s expected to generate a maximum of 468 megawatts with an average anticipated output of 182 megawatts, enough to power about 70,000 homes.

Developers hope to have the project running by the end of 2012, but obstacles remain.

Several opponents have filed lawsuits, and a deal with the utility National Grid to buy half the project’s power is being weighed by state regulators, who are expected to decide on it by the end of November. Cape Wind developers need the contract approved to begin construction by the end of the year — a condition to qualify for key federal tax credits.

Project opponents say Cape Wind’s power is too expensive and argue the project threatens marine life as well as maritime traffic and industry. They also say it will ruin historic vistas in the sound.

Audra Parker of the Alliance to Protect Nantucket Sound, the chief opposition group, said apart from the other hurdles, Cape Wind must sell the other half of its power and can’t proceed with construction without presenting a detailed operating plan to federal regulators.

“Even though they have the lease, Cape Wind is far from shovel-ready,” Parker said.

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