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The Uncertain Future of Commonwealth Wind: A Look into the Ongoing Legal Battle

Updated: Jan 30, 2023

The Commonwealth Wind project is a major renewable energy initiative that has been proposed for development in Massachusetts. The project, which is being developed by a consortium of companies, aims to provide clean, reliable, and cost-effective electricity to the people of the state.

The project first came to the attention of the public in 2016, when the Massachusetts Department of Energy Resources (DOER) announced that it would be issuing a Request for Proposals (RFP) for long-term contracts for renewable energy. This RFP was part of the state's commitment to increasing the use of renewable energy and reducing greenhouse gas emissions.

The RFP attracted a number of bids from companies and consortiums looking to develop renewable energy projects. Among the bidders was the Commonwealth Wind consortium, which proposed the development of a 1,200-megawatt (MW) wind energy project off the coast of Massachusetts.

The DOER evaluated all of the bids received in response to the RFP, and in 2017, it announced that the Commonwealth Wind consortium had been selected as the preferred bidder for the project. This was a major milestone for the project, as it meant that the DOER had determined that the project was viable, and that it had the potential to provide significant benefits to the people of the state.

After being selected as the preferred bidder, the Commonwealth Wind consortium began working to secure all of the necessary approvals and permits for the project. This included working with the Federal Energy Regulatory Commission (FERC), the Bureau of Ocean Energy Management (BOEM), and the Massachusetts Department of Public Utilities (DPU).

In 2018, the FERC granted the project a preliminary permit, which allowed the consortium to begin conducting detailed studies and surveys of the proposed project site. The BOEM also issued a lease for the project area, which further confirmed the viability of the project.

In 2019, the DPU approved the Power Purchase Agreements (PPAs) between the Commonwealth Wind consortium and the state's distribution companies. This was a critical step in the development of the project, as it meant that the consortium had secured long-term contracts for the sale of electricity generated by the project.

Legal Battle Timeline

October 18, 2022

The Department of Energy Resources (DOER) submits this brief in support of the approval of long-term power purchase agreements (PPAs) submitted by Eversource, National Grid, and Unitil for offshore wind energy generation and renewable energy certificates (RECs) associated with the 1,200 MW Commonwealth Wind project and the 405 MW Mayflower Wind project. DOER argues that the solicitation process was open, fair, and transparent and resulted in winning bids being selected in a reasonable manner. Additionally, the PPAs are cost-effective, meet all requirements and criteria of Section 83C of An Act Relative to Green Communities, and are in the public interest. Therefore, the Department should approve the PPAs.

November 1, 2022

Commonwealth Wind argues that the Affidavit of Sy Oytan should be accepted as evidence in a proceeding involving power purchase agreements (PPAs) between Commonwealth Wind and the Massachusetts electric distribution companies. The Affidavit contains new information that was previously unknown or unavailable and is relevant to material issues in the proceeding, and could have a significant impact on the outcome. It also meets all the procedural requirements of 220 C.M.R. § 1.10(1). The document argues that the Affidavit should be accepted because it contains critical information that should inform the Department's substantive decisions in these proceedings and the Oytan Affidavit meets the established "good cause" standard for reopening the record.

Sy Oytan, Senior Vice President for Offshore Projects at Avangrid Renewables, LLC, states that the Commonwealth Wind Project, an approximately 1,200 MW offshore wind energy project, was bid into a solicitation under Section 83C in September 2021. However, since then, significant global events such as high and persistent inflation, supply shortages, and an unprecedented increase in interest rates, have negatively affected the economics of the Project and added hundreds of millions of dollars in additional projected capital and debt costs. As a result, Commonwealth Wind has concluded that the Project now has a significantly decreased net present value under the current terms of the PPAs and would no longer support financing. Commonwealth Wind believes that a modest increase in the contract prices for the PPAs, coupled with improvements to the economics of the Project that Commonwealth Wind can take, can restore a positive net present value to the Project and allow for a return that is adequate to support financing.

November 4, 2022

Commonwealth Wind, LLC is requesting that the Department of Public Utilities dismiss the above-captioned proceedings, which involve power purchase agreements (PPAs) between Commonwealth Wind and Massachusetts electric distribution companies, in connection with an offshore wind generation facility being developed by Commonwealth Wind. The company argues that the PPAs do not meet the fundamental statutory threshold that they must “facilitate the financing of offshore wind energy generation” as required by Section 83C, and that despite efforts by Commonwealth Wind to find a path forward, it does not appear that there is a viable pathway that would allow that threshold to be met. They also argue that because the PPAs will not facilitate the financing of the project, they will also not deliver the specific statutorily required benefits and will not meet the statutory criteria set forth in Section 83C(e)(1)(v) and restated at 220 C.M.R. § 23.05(1). They argue that due to recent changes in economic conditions and increased costs for offshore wind projects, the PPAs are now uneconomic and insufficient to support financing and that the best path forward is for the offshore wind energy generation capacity currently included in the PPAs to be procured in the next solicitation under Section 83C.

December 23, 2022

The Companies (NSTAR Electric Company d/b/a Eversource Energy, Massachusetts Electric Company and Nantucket Electric Company d/b/a National Grid, and Fitchburg Gas and Electric Light Company d/b/a Unitil) are submitting this letter in reply to the Motion to Dismiss filed by Commonwealth Wind LLC in the above-referenced proceedings. They argue that the Department should deny Commonwealth Wind’s Motion to Dismiss, stating that Commonwealth Wind negotiated and executed comprehensive Purchase Power Agreements with the Companies that are now before the Department for approval following a full and fair adjudicatory process. They argue that approving the Motion to Dismiss at this very late stage would significantly undermine what to date has been a very successful process established in Massachusetts to encourage the development of offshore wind projects. Therefore, based on substantial record evidence, the Companies are requesting that the Department approve the power purchase agreements they have executed with Commonwealth Wind and Mayflower Wind LLC to acquire respective, pro rata shares of the energy and associated Environmental Attributes from the developers’ aggregate 1,605 MW of Offshore Wind Energy Generation.

January 19, 2023

Commonwealth Wind, LLC is filing a petition for appeal against the Massachusetts Department of Public Utilities (Department) regarding the approval of power purchase agreements (PPAs) between Commonwealth Wind and three Massachusetts distribution companies. Commonwealth Wind is arguing that the Department's decision to approve the PPAs does not align with the purpose of the statute, which is to facilitate the financing of offshore wind energy generation resources in the Commonwealth. Commonwealth Wind submitted evidence and briefing that due to changes in global markets, the PPAs would not facilitate the financing of the Project, and requested that the Department dismiss the proceedings as to the PPAs. The Department however, approved the PPAs despite this evidence and Commonwealth Wind is requesting that the Department's decision be overturned.

January 19, 2023

In this emergency motion, Mayflower Wind Energy LLC is requesting that the Massachusetts Department of Public Utilities grant Mayflower Wind full participant status in two proceedings in which the Department recently approved power purchase agreements (PPAs) to which Mayflower Wind is a party. Mayflower Wind previously had limited participant status in the proceedings. Mayflower Wind also requests that the Department extend the 20-day period for filing an appeal of the Department's Orders in the proceedings for a period of five (5) business days after the Department issues an order or ruling in response to this emergency motion. Mayflower Wind cites concerns related to the financeability of each of Mayflower Wind's generation projects and the inter-relationship between the two proceedings as reasons for requesting full participant status and an extension of the appeal period.

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