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February 18, 2012  NStar deal, rise of Cape Wind will boost state’s economy

THE PATRICK administration negotiated diligently and emerged with a fair bargain from the power company NStar, requiring it to purchase electricity from Cape Wind as a condition of state approval of its merger with Northeast Utilities. The deal preserves current electric rates for four years, while moving the nation’s first offshore wind farm a huge step closer to reality.

The $17.5 billion merger still needs to win approval from regulators in Connecticut, where Northeast Utilities is based. But from the standpoint of Massachusetts, the deal now meets the test of serving the public interest.

In exchange for the Commonwealth’s approval of the merger, the combined utility has agreed to buy 27.5 percent of the output from Cape Wind, the 132-turbine wind farm slated for the waters off Nantucket. Another large Bay State power company, National Grid, had already committed to buying half. With more than three-quarters of the wind farm’s electricity now accounted for, the deal should make it possible for Cape Wind to get financing and begin construction.



IN HIS state-of-the-union message last month, Barack Obama said that America needs “an all-out, all-of-the-above strategy that develops every available source of American energy.” Mr Obama boasted about a wind-turbine factory in Michigan, America’s abundant supplies of natural gas and the millions of acres opened for oil exploration. He urged Congress to pass tax incentives for energy efficiency and clean energy and to end oil-company subsidies.

But Mr Obama made no mention of nuclear energy, even though America’s 104 nuclear reactors provide around one-fifth of its electricity, and even though the Nuclear Regulatory Commission (NRC) was poised to approve, for the first time since the Three Mile Island accident in 1979, the construction of a new nuclear reactor on American soil. It duly did so on February 9th, giving its first-ever combined construction and operation licences to the Atlanta-based Southern Company to build two new reactors at Plant Vogtle, in eastern Georgia, where they will join two existing reactors that have been in operation for 25 and 23 years. Southern Company got $8.3 billion in federal loan guarantees for the Vogtle expansion, and it expects the new reactors to begin operation in 2016 and 2017. This will be the among the largest construction projects in Georgia’s history, representing capital investment of $14 billion and bringing the state, by the firm’s estimate, 3,500 construction jobs and 800 permanent jobs.

Some claim that the Georgia decision heralds a nuclear renaissance in America. 

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