Court paves way for 1st offshore wind farm in US

A Rhode Island Supreme Court ruling paves the way for Deepwater Wind to move forward with permitting and development of its planned Block Island Wind Farm, which remains on track to be the first offshore wind farm in the US.

The court upheld Deepwater Wind’s power purchase agreement with National Grid for the renewable energy generated from the planned wind farm. The Rhode Island Public Utilities Commission had approved the power purchase contract in August 2010.

The Block Island Wind Farm, one of two Rhode Island-area offshore wind farms being developed by Deepwater Wind, is a demonstration-scale, 30-megawatt offshore wind farm with five wind turbines. The farm will be located in Rhode Island state waters, about three miles off of the southeastern coast of Block Island.

The wind farm will produce more than 100 million kilowatt hours of clean energy annually. It is expected that the wind farm will supply approximately 90 percent of the island’s power needs, with the remainder supplied from the mainland grid via the Block Island Transmission System being developed in conjunction with the wind farm. This project will allow the island to power down and place on standby the expensive diesel fuel generators that now provide electricity for the island.

Even while supplying the island with the majority of its power needs, the wind farm will export 90 percent of the power it generates back to the mainland grid through the new undersea transmission cable.

Site preparation work is planned to begin in 2012, with the wind farm set to start commercial operations in 2013 or 2014.

The approved power agreement caps the energy cost at $0.24/kilowatt hour in the first full year of commercial operations, which translates to a $1.35 charge per month for a typical Rhode Island household. Under the “open book” pricing structure, Deepwater Wind cannot exceed that cap and must return any cost savings reaped during construction to ratepayers. Conversely, Deepwater Wind must absorb any construction cost overruns.

The Block Island Wind Farm and the transmission cable linking the windfarm, the island, and the mainland are expected to require a capital investment of approximately $250 million, all of which will be raised from the private sector. Deepwater Wind has invested in excess of $10 million in the Block Island Wind Farm to date.