CommonWealth Journal

THE LEGISLATURE’S ENERGY specialists say it is sensible to penalize CommonWealth Wind and Mayflower Wind in the event that they default on their not too long ago permitted energy buy contracts, however the lawmakers don’t need the penalties to incorporate a ban on participation in an upcoming offshore wind procurement.

The Home and Senate chairs of the Legislature’s Utilities, Telecommunications, and Power Committee say the state must stroll a high quality line between penalizing the businesses however not penalizing itself.

The Division of Public Utilities on December 30 permitted energy buy contracts between the state’s three utilities and Commonwealth Wind and Mayflower Wind. Avangrid, the developer behind Commonwealth Wind, mentioned it couldn’t finance its mission with the prevailing phrases, and Mayflower, a three way partnership of Shell Power Ventures and Ocean Winds, mentioned it faces an analogous predicament.

Showing on The Codcast, Sen. Michael Barrett of Lexington and Rep. Jeffrey Roy of Franklin mentioned they have been sympathetic to the challenges the wind farm builders are going through, together with rising inflation and rates of interest, provide chain difficulties, and the battle in Ukraine.

“The world is a special place,” Barrett mentioned. “The battle in Ukraine couldn’t have been anticipated. The influence on pure fuel costs in Europe and the attraction of LNG towards Europe and away from New England which depends on LNG [liquefied natural gas] for winter heating couldn’t have been totally anticipated. Provide chain disruptions are actual.”

However Barrett mentioned state policymakers additionally face a problem. “On the one hand, you don’t need to let these builders exploit you and cite these latest developments so as to get a greater deal. However you additionally need to acknowledge that some issues actually are unprecedented. What I’m focused on is preserving competitors for the following spherical,” he mentioned.

“So regardless that you’re upset about Mayflower and Avangrid, you would most likely discover a means ahead that appears one thing like this,” Barrett mentioned. “Initially, you may need to impose a cash penalty on Avangrid if it chooses actually to default and step again from performing a contract that they’ve signed. You might need to impose an analogous cash penalty on Mayflower. That’s separate, although, from deciding whether or not or to not bar them from competing within the subsequent spherical. You might need to assess factors in opposition to their bid within the subsequent spherical. However, basically, you need to maintain as many of those offshore builders within the race as you possibly can.”

4 wind farm builders maintain offshore wind leases off the coast of Massachusetts. Solely Avangrid and Mayflower have landed contracts thus far to construct out wind farms of their lease areas,, with Orsted and Equinor presently selecting to pursue initiatives in different lease areas they personal off the coast of different states.

  Roy mentioned he agrees with Barrett’s evaluation. “We don’t want firms making guarantees they will’t maintain, however we do must get strong renewable vitality,” Roy mentioned. “I’m all for shifting ahead and dealing with these firms so we will try this and obtain our purpose.”

Roy is anxious about shedding the financial advantages related to the Avangrid bid — a cable manufacturing plant at Brayton Level in Somerset and a buildout of the Salem waterfront to accommodate offshore wind – however he predicts these investments will occur finally as a result of they’re wanted to service the rising offshore wind business.

“If Avangrid doesn’t proceed with its mission, there’s going to be one other firm behind them that may do it,” he mentioned.

Roy and Barrett touched on numerous different subjects:

– The Democratic lawmakers don’t anticipate the state’s vitality technique to alter dramatically underneath Gov. Maura Healey, however they mentioned her appointment of a cabinet-level local weather chief indicators a change in tone.

“I do anticipate she goes to lift the bar a bit,” Roy mentioned. Barrett mentioned he had some severe coverage variations with the Baker administration, and people might ease with Healey. “You’ll see us singing from the identical hymn e book extra usually,” he predicted.

– Healey is asking for doubling the state’s wind energy goal from 5,600 megawatts to 11,200 megawatts. The 2 lawmakers welcome the upper purpose, however say it should be accompanied by a change in the way in which clear vitality is procured.

Barrett want to see procurements involving a number of states and procurements pitting varied forms of clear vitality – offshore wind, onshore wind, photo voltaic, hydro, and so forth. — in opposition to one another to maintain pricing aggressive.

Each lawmakers just like the latest resolution by the Baker administration to have Massachusetts ratepayers take a 40 % stake in a proposed onshore wind farm in Maine. “It’s an important instance of regional cooperation,” Roy mentioned.

Roy would additionally prefer to see Massachusetts ratepayers take a stake within the Millstone nuclear energy vegetation in Connecticut. “Hopefully with the following administration maybe that problem might be revisited,” Roy mentioned.

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