Cape Wind was supposed to be the nation's first offshore wind farm. Now, it may be dead in the water.
Cape Wind was under contract to begin construction in Nantucket Sound by the end of December. Earlier this week, when it hadn't started, utilities that promised to buy 80 percent of the electricity generated by the 130 offshore turbines pulled the plug on their agreements.
Former Massachusetts Gov. Deval Patrick was a major supporter of Cape Wind and says he's still optimistic about the future of the state's offshore energy industry. But the new Baker administration may have to look to a more distant horizon.
Litigation May Be Dooming Cape Wind
In his inaugural address Thursday, Gov. Baker drew a direct link between the state's economic growth and a sustainable, affordable supply of energy.
"Families and business across New England are being hit with unprecedented increases in their energy and electric bill at exactly the same time energy prices are falling across the rest of the country," Baker said.
Gov. Baker blames inadequate energy delivery systems. That's a reference to recent calls for the construction of more natural gas pipelines. Two-thirds of the state's electricity comes from burning natural gas, and that's growing as oil and coal plants shut down.
But Gov. Baker also acknowledges the need to reduce our carbon footprint. Under state law, utilities are required to buy an increasing percentage of their electricity from non-fossil fuel sources. And the biggest carbon-free project in the works in the state has been Cape Wind.
As a candidate Gov. Baker first opposed the offshore project. Then he accepted it as a done deal. But just days before taking office it became undone, and now Cape Wind may be doomed by more litigation.
"We know the history of Cape Wind and it is now a contractual issue," said Matthew Beaton, Baker's new energy secretary. "If it ends up in court or not, it's hashed out, you know wait and see how it gets cleaned up."
Cape Wind charges that it was relentless, costly litigation by opponents that prevented it from beginning construction on time, and cites a special clause in the utility agreements that it says permits delays. But even now the group that's led the legal battle against the offshore wind project isn't letting up.
"In fact, on Monday of this week we were in the U.S. of Court of Appeals with that lawsuit before a panel of three judges," said Audra Parker, head of the Alliance to Protect Nantucket Sound. She says the group isn't against offshore wind power, it just wants turbines to be out of sight and out of Nantucket Sound.
"There are alternatives to Cape Wind that have fewer impacts," Parker said. "For example, at the end of this month the federal government will be auctioning off areas far off the Massachusetts coast. So there is a right way and a wrong way."
Future Of Wind Energy Industry Hangs In Balance
Cape Wind would take up 24 square miles of Nantucket Sound, with turbines five miles from the shore. But 12 miles south of Martha's Vineyard is the Massachusetts wind energy area, and on Jan. 29 the Department of Interior plans to auction off this part of the sea to commercial wind companies. At 1,100 square miles, it's by far the largest offshore lease sale in U.S. history.
"It's clear that offshore wind is going to be part of our energy future because it's such an abundant resource, and because it can generate power when we need it most, which is time of year," said Sean Mahoney, executive vice president of the Conservation Law Foundation.
The electricity from Cape Wind could power 60,000 homes. If all of the Massachusetts wind energy area is sold at the end of the month and developed over the years, it could serve the electric needs of nearly 1.5 million homes -- half the houses in the state.
"So the market will grow, the problem right now is financing," Mahoney said.
While it's wind that makes turbines go round, it's money and investor confidence that will make or break the industry. The U.S Department of the Interior says a dozen companies are financially qualified to bid in this month's auction. How many actually will, given the high cost of construction in the ocean — and the Cape Wind experience — is still up in the air. And hanging in the balance is Massachusetts offshore, clean-energy future.
This segment aired on January 9, 2015.