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Governor, Lawmakers Lift Wind Power Price Cap

August 2, 2019
 
The Legislature last week approved an AIM-backed amendment proposed by Governor Charlie Baker to lift the price cap on offshore wind contracts.
 
The governor's amendment and legislative approval clarified a proposal to modify the requirement that the price of the next offshore wind contract beat the price from the first 800-megawatts of offshore wind recently approved by the Department of Public Utilities.  
 
While AIM supported the original price-cap language, developers interested in bidding in the next solicitation expressed concerns that the requirement for lower prices would be difficult to meet due to changes in the federal investment tax credit – something not anticipated when the price-cap language was written. 
 
The change will ensure that the current solicitation for 800 megawatts of new offshore wind power is not disrupted.
 
Robert Rio, senior vice president of Associated Industries of Massachusetts, said the governor was "right to remove the price-cap language for this solicitation for offshore wind" given the August 9 due date for solicitations and uncertainty over federal tax credits.
 
"We believe the prices for power will be competitive under the current solicitation and we look forward to seeing the result," Rio said in a statement.
 
The governor said he was worried that the complexity of the original language would "most certainly disrupt the procurement schedule and jeopardize the commonwealth's ability to take advantage of any cost savings from federal tax incentives."
 

 

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