GERMANY’S SIEMENS BACKS U.S. OFFSHORE PROJECT

Key investor still committed to Cape Wind
June 22, 2011 (South Coast Today)

"The company that will supply turbines for Cape Wind is still willing to help finance the offshore wind farm even though a federal loan for the project has fallen through, Siemens AG Chief Financial Officer Josef Kaeser said…Cape Wind Associates LLC officials confirmed…discussions between the two companies about financing.

"…Kaeser said that he had no doubt that Cape Wind will go forward…Siemens Energy Inc., the U.S. subsidiary of the German-based company, [will supply the 3.6-megawatt turbines for Cape Wind…Cape Wind is gratified that Siemens is interested in participating in the project, [Jim Gordon, president of Cape Wind] said, adding that his company continues to put together a financing plan for the wind farm…Cape Wind still hopes to begin construction on the wind farm before the end of the year or by the start of next year, Gordon said…"

click to enlarge

"…National Grid has agreed to buy half of the 130-turbine project's power but Cape Wind has struggled to find a buyer for the second half of the electricity produced by the project. The National Grid deal calls for the utility to pay about 19 cents per kilowatt hour for the power, a price that will increase 3.5 percent per year during the contract's 15-year lifetime…

"…The additional cost of Cape Wind's power for the average residential ratepayer in National Grid's territory would be $1.50 per month, according to the utility's calculations. Cape Wind's opponents argue that the cost to businesses will be much greater and that the project will end up costing consumers far more than other sources of power."

Siemens' new prototype 6 MW offshore turbine (click to enlarge)

"Financing for the project has also been in doubt, especially in light of a decision by the Department of Energy to put a nearly $2 billion loan guarantee for the project on hold…Cape Wind is expected to cost more than $2.5 billion to build.

"The project still faces a host of legal challenges and must find a buyer for the second half of its power. The Supreme Judicial Court is expected to hear one of the lawsuits challenging the high cost of the project in September…The company is confident that it will survive the various court challenges based on the merits of the project and the intense review it has undergone, Gordon said…"