Wind farm, utility agree
National Grid has agreed to pay Deepwater Wind the same price previously negotiated for electricity from a wind farm planned in waters off Block Island but, in a new contract proposal filed with state regulators on Wednesday, the two sides left open the possibility of a lower price.
It is the second agreement Rhode Island’s dominant electric utility and the state’s preferred developer of offshore wind energy have submitted to the state Public Utilities Commission. The first was rejected in March, because the starting price — also 24.4 cents per kilowatt-hour, but without the possibility of a decrease — was deemed not “commercially reasonable” by the three-member commission.
The new contract uses that price in the first year, but as an upper limit. Under what’s known as an “open-book” proposal, Deepwater’s accounts would be audited by a third party selected by the state and the price would be set according to the actual construction costs of the eight-turbine project, estimated at $205 million, and a predetermined return on investment for the company of between 10.5 and 12 percent. The amended price would then increase 3.5 percent annually over the 20-year contract.
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