'Shockingly' low prices for Massachusetts energy thanks to US offshore wind
The first ever large offshore wind project in the US has set a record for the lowest energy prices, which will make electricity across Massachusetts cheaper than any analyst could have anticipated.
The Vineyard Wind project, which is the first commercial-scale offshore wind farm in America, has a capacity of 800MW and is situated just off the coast of Massachusetts. The wind farm was jointly developed by Avangrid and Copenhagen Infrastructure Partners.
The “shockingly” cheap energy will start from just $74mn per MW hour, with this pricing having been published for the Phase 1 project this week. The figure is to increase by 2.5% per year for the next 20 years, and applies to both energy and renewable energy credits.
Bloomberg states the low prices equate to $1.4bn in savings for Massachusetts electricity users over the next two decades, with the energy coming in at around 18% cheaper than alternative sources.
Tom Harries, a wind analyst at Bloomberg NEF said: “That’s pretty shocking for us. I think the wider industry expected much higher prices. The repercussions of this are it will probably awaken a lot of other coastal states to the value of offshore wind.”
Drax advances biomass strategy with Pinnacle acquisition
The Group’s enlarged supply chain will have access to 4.9 million tonnes of operational capacity from 2022. Of this total, 2.9 million tonnes are available for Drax’s self-supply requirements in 2022, which will rise to 3.4 million tonnes in 2027.
The £424 million acquisition of the Canadian biomass pellet producer supports Drax' ambition to be carbon negative by 2030, using bioenergy with carbon capture and storage (BECCS) and will make a "significant contribution" in the UK cutting emissions by 78% by 2035 (click here).
This summer Drax will undertake maintenance on its CfD(2) biomass unit, including a high-pressure turbine upgrade to reduce maintenance costs and improve thermal efficiency, contributing to lower generation costs for Drax Power Station.
In March, Drax secured Capacity Market agreements for its hydro and pumped storage assets worth around £10 million for delivery October 2024-September 2025.
The limitations on BECCS are not technology but supply, with every gigatonne of CO2 stored per year requiring approximately 30-40 million hectares of BECCS feedstock, according to the Global CCS Institute. Nonetheless, BECCS should be seen as an essential complement to the required, wide-scale deployment of CCS to meet climate change targets, it concludes.