Cape Wind will reduce wholesale electric prices for the New England region by $7.2 billion over 25 years, according to a new report published today by Charles River Associates, a leading economic consulting firm.
The report shows that ISO New England, the electric grid operator, first dispatches electric generating units with the lowest cost fuel. Since Cape Wind’s fuel – wind – is zero cost, the report states that Cape Wind will displace higher priced and polluting fossil fueled units resulting in average savings of $286 Million per year in New England.
“This report makes it clear that Cape Wind will save electric consumers billions of dollars through price suppression while also creating jobs and helping promote cleaner air and greater energy independence,” said Mark Rodgers, Cape Wind Communications Director.
The Charles River Associates report is entitled, ‘Update to the Analysis of the Impact of Cape Wind on Lowering New England Energy Prices’, and was commissioned by Cape Wind. The original report was published in February, 2010.
The increase in price suppression in the report update was attributed primarily to an increase in power plant retirements and a larger price difference between natural gas and fuel oil.
Price suppression in wholesale electric markets occurring as a result of wind power projects has been documented in Europe and in several U.S. power markets. Price suppression from wind power was noted in the 2009 report entitled, ‘New England Governors’ Renewable Energy Blueprint’, which stated “All of the wind resource potential could provide downward pressure on the marginal prices for energy within the New England electricity market…this price pressure would ultimately benefit New England consumers.”
Cape Wind is America’s first offshore wind farm to secure Federal and State approval and to be issued a lease to operate by the Federal Government. Cape Wind will create jobs and promote greater energy independence and a cleaner environment. Cape Wind will also establish Massachusetts as a leader in offshore wind power. For more information visit www.capewind.org.