February 12, 2010
Cape Wind promises big reductions in electric prices
The proposed Cape Wind project would reduce wholesale electric prices for the New England region by $4.6 billion over 25 years, according to a new report.
Whether consumers will get to enjoy the resulting savings depends on a decision by the Department of the Interior to give the project the go ahead. Public comment on the Cape Wind application was set to close February 12 with consideration of final alternatives beginning March 1 and a final decision promised by the end of April.
The new report finds that Cape Wind would place downward pressure on the wholesale clearing price of electricity.
Entitled "Analysis of the Impact of Cape Wind on New England Energy Prices," it was commissioned by Cape Wind from Charles River Associates (CRA).
CRA's analysis of the impact of the 468 MW offshore wind power project found the additional supply from Cape Wind would reduce the need for generation from other power plants with higher pollutant emissions and operating costs, primarily fueled by natural gas, oil, and coal. CRA has projected wholesale power prices over the period 2013-2037, for scenarios with and without Cape Wind in service, and quantified the expected reduction in wholesale power prices and wholesale electricity costs that would result from the power supplied by the project.
The principal findings of the analysis are:
Adding Cape Wind would lead to a reduction in the wholesale cost of power averaging $185 million annually over the 2013-2037 time period, resulting in an aggregate savings of $4.6 billion over 25 years.
With Cape Wind in service, over the 2013-2037 time period, the price of power in the New England wholesale market would be $1.22/MWh lower on average.
You can access the study HERE