DOE Proceeds with Review of Cape Wind Loan Guarantee After Favorable Court Ruling


The Energy Department is proceeding with "active review" of an application for a loan guarantee by Cape Wind Associates LLC after a federal court decision in March upholding the Interior Department's approval of the company's proposed $2.6 billion wind farm, the head of the DOE loan guarantee program said.

The litigation, brought by project opponents, had been holding up review of the loan guarantee for the project, a 130-turbine wind farm proposed off the coast of Massachusetts, which could become the first offshore wind farm in the U.S., Executive Director Peter W. Davidson told Bloomberg BNA April 29.

"The judge rendered a decision, and it was extremely favorable for the Cape Wind project," Davidson said of the March 14 decision. "It's in the mode of still being considered. We were waiting until there was a resolution from the lawsuit that was going on here in the district court in D.C."

Specifically, the U.S. Court of Appeal for the D.C. Circuit dismissed 16 out of 18 challenges filed by a coalition of environmental groups challenging several federal agencies' decision to authorize construction of the project (Pub. Emp. for Envtl. Responsibility v. Beaudreu, D.D.C., Civil Action No. 10-1067, 3/14/14).

In the two remaining cases, the court ordered the Fish and Wildlife Service and the NOAA Fisheries Service to provide additional information to the court regarding the impacts to right whales and migratory birds. 

Project in Nantucket Sound

The court decision paves way for the Energy Department's loan programs office to proceed with review of the loan, which includes financial due diligence and eyeing possible "regulatory issues," Davidson said.

A spokesman for the Boston-based Cape Wind declined to comment.

Cape Wind President Jim Gordon previously called the court's decision an "incredibly important" legal victory that "clears the way" for project financing.

The project, proposed over a 25-mile area in Nantucket Sound known as Horseshoe Shoal, has two power purchase agreements in place with Massachusetts utilities National Grid and NSTAR.

Cape Wind has said it will begin onshore cable route construction by the end of 2014 and begin ocean construction in 2015. It expects to begin commercial operations in late summer 2016. 


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