Computer simulated view on Cape Wind wind farm from Cotuit.

National Grid announced the company's rate-payers will purchase half of the generated power from the Cape Wind project. The USD 442 million purchase deal will be spread out over a period of fifteen years. The total cost of the project's power output however, is USD 884 million, or double the amount. It is speculated, though, that the total cost can actually be a lot higher, based on premiums businesses will pay.

The wind farm project opposition, such as the Alliance to Protect Nantucket Sound, has expressed concerns over fears that the expensive electricity from the project, in the already most expensive power purchasing environment in the country, would drive even more businesses and families to move elsewhere.

Initially, the cost per kWh will be about 256% of the current price, while over time, this prices will jump even higher, reaching a 420% increase level. A major blow for consumers indeed. The question remains however, whether consumers will be willing to pay the much higher prices for electricity simply because it came from a clean energy source such as wind turbines.

National Grid, on the other hand, emphasizes the fact that the state of Massachussetts has to make efforts to meet the adopted renewable energy and carbon emission goals. The company aims to create an opportunity to seize the leadership position in the global energy economy. Pending approval by the Department of Public Utilities, National Grid's power purchase program will begin in 2013. According to the company, the price of purchased power will increase about 3.5% annually, over the next 15 years, while consumers shold feel an increase on their electrical bill by 2013 of no more than USD 1.59 per month.

The Cape Wind project has been subject to criticism, and was even paused in early 2010, due to strong opposition, which forced the government to return the project to the discussion table. A few weeks ago however, the decision was made by the government to move on with the project, having had no result from the two months of reviews and discussions.

[source: National Grid, Alliance to Protect Nantucket Sound]