The nation's first offshore wind farm — to be located in Nantucket Sound — secured its first customer last week as National Grid will purchase 50% of the project's energy production.
The purchase agreement between Cape Wind Associates, developer of the wind farm, and National Grid, an international electric and gas company serving Great Britain and the northeastern U.S., will last 15 years. National Grid will pay 18.7 cents per kilowatt-hour in 2013 and that fee will increase 3.5% annually for 15 years. Once the contract expires, National Grid has the right to a one-time extension for 10 years on terms that could be below market rates, according to Massachusetts' Department of Public Utilities.
The $1 billion Cape Wind development could supply Cape Cod, Martha's Vineyard, and Nantucket with 75% of their electricity demand. Cape Wind Associates expects the wind farm will generate a maximum electric output of 468 megawatts and an average output of 182 megawatts, which could power more than 200,000 homes.
