DOE Provides Cape Wind with $150 Million Loan Guarantee

Even though Massachusetts has a law mandating renewable energy production[1], offshore wind generation has had a problem getting off the ground there due to its high cost. So, 13 years since the Cape Wind project was first proposed, it needs to be saved by the government. The Department of Energy (DOE) has come to the rescue with a $150 million loan guarantee. That loan guarantee, which Energy Management Inc., Cape Wind’s developer, first applied for in 2009 – when combined with its other project financing – will only give Cape Wind 58 percent of the $2.5 billion it needs to construct 130 wind turbines offshore in the Nantucket Sound. Nevertheless, the DOE says the project has reached a point where it is likely to be constructed because a large portion of the financing is in place, regulatory approvals have been obtained, and most legal challenges have been resolved.(i) DOE expects construction to start in 2015. If the project is really “a go,” this would be the nation’s first offshore wind farm, and it will end up providing expensive, unreliable electricity to the residents of Massachusetts.