Top senator skeptical about scrapping offshore wind price cap

Boston Statehouse

BOSTON (SHNS) – House Speaker Ron Mariano last week announced that the House will seek to eliminate the offshore wind price cap this session to encourage greater competition for the state’s clean power projects, but a key senator said he is not as sure that’s the way to go.

Sen. Michael Barrett, who chairs the Telecommunications, Utilities and Energy Committee for the Senate, said he spoke with the two eligible developers that took a pass on the latest Massachusetts offshore wind solicitation about their reasoning and does not want to jump to any one conclusion.

There is “a mix of things” going on and Massachusetts should be “careful about settling on policy directions for the next wave of offshore development,” Barrett said.

“We should get things in place, no question. But there is room for reasonable disagreement here,” said the Lexington Democrat, who will likely be the Senate’s lead negotiator if and when the Legislature passes additional offshore wind or climate policy legislation later this session. “I don’t think that simply lifting the cap altogether is a very good way to protect Massachusetts ratepayers; we do have the highest electric rates in the nation.”

The state’s third competitive solicitation attracted bids from just Vineyard Wind and Mayflower Wind, a smaller pool of bids than Mariano and others were hoping for. The speaker last week singled out the price cap policy that requires the price of each new offshore wind project to be lower than that of the project before it and said it should be eliminated. Massachusetts has so far put an emphasis on low costs in its offshore wind solicitations, but the legislation Mariano and TUE Committee House co-chair Jeff Roy outlined last week would essentially pivot the state from focusing mostly on cost and towards other aspects of the bids, like job creation and long-term economic development.

“We’re going to be looking at those price caps. We’re going to be looking at quantifying and increasing the weight of economic development impacts in future bids,” Roy said. “We’ll make investments in offshore wind through an investment fund, trying to emulate what we did for the life sciences. We’re gonna look at port infrastructure … we’re going to look at grid modernization and transmission planning issues, and increase funding for higher ed institutions who are working in the space.”

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