Funds and New Timetable for Offshore Wind Farm in Massachusetts

Source: By KATHARINE Q. SEELYE, New York Times • Posted: Thursday, February 27, 2014

BOSTON — Cape Wind, the much-delayed offshore wind farm project proposed for Nantucket Sound, said Wednesday that it had received a new loan commitment that would allow it to finish its financing this fall and begin producing power by 2016.

“We expect to complete project financing in Q3,” Mark Rodgers, a spokesman for Cape Wind, wrote in an email, referring to the third quarter. “We will begin construction (on land) shortly thereafter. We will begin ocean construction in 2015 and commission the project in 2016.”

The timetable is the latest in a series of projected target dates from the company since it first proposed the wind farm in 2001. It has had to move back the dates at least four times in recent years because the financing has not been in place or because of legal or regulatory obstacles.

It still faces various hurdles, and opponents question whether it will be able to meet this new deadline.

Cape Wind has long held out the promise that it would become the nation’s first offshore wind farm, using 130 large turbines to provide clean, renewable energy for 75 percent of customers on Cape Cod, Martha’s Vineyard and Nantucket.

Jim Gordon, the president of Cape Wind, last fall in Boston. He said Wednesday that the company had received a $600 million loan commitment from a Danish investment agency.CreditEvan McGlinn for The New York Times

But in a decade-long drama, it has been fiercely challenged: by wealthy homeowners who say it would ruin their views; by businesses that fear substantial rate increases; and by fishermen who say it would interfere with their catches.

Jim Gordon, Cape Wind’s president, announced Wednesday during an offshore wind conference here that the company had received a new loan commitment of $600 million from the Danish Export Credit Agency, or EKF.

“EKF is a very knowledgeable and experienced investor in the offshore wind industry, and they recognize that Cape Wind makes sense both economically and environmentally,” Mr. Gordon said.

Combined with commitments of $200 million from Pension Danmark, a Danish public pension fund, and $100 million from the engineering company Siemens AG, which would manufacture the wind turbines, Cape Wind would appear to have barely raised $1 billion for the project, estimated to cost $2.6 billion.

The Bank of Tokyo-Mitsubishi is also an investor, but its contribution has not been made public. Cape Wind is also hoping for a $500 million loan guarantee from the federal Energy Department, but otherwise, all of its financing comes from overseas.

The Alliance to Protect Nantucket Sound, the major opponent of Cape Wind, continued to cast doubt on whether the project would move forward. Cape Wind still faces five federal lawsuits filed by nearly a dozen parties that are challenging federal permits, Audra Parker, the alliance’s president, said.

Questions also remain about Cape Wind’s “overpriced” power contract with Massachusetts utilities, she said, adding that those contracts are to terminate at the end of 2015 if Cape Wind has not begun construction.