Offshore Is In The Air, Cape Wind Announces Wind Turbine Deal With Siemens

Cape Wind knows a good news hook. With offshore dominating the news-cycle  (and the Google search terms), the persistent Boston-based offshore wind developer chose today to announce that it has entered into an agreement with Siemens of Germany to purchase up to 130, 3.6-megawatt wind turbines for the  420-megawatt wind farm it wants to build off Cape Cod.

This is the second turbine contract for Cape Wind. When the project was first launched in 2003 General Electric got the turbine contract. However, GE walked out of the offshore wind turbine business, forcing Cape Wind to get a new supplier.

Securing turbines is a key step in any project development as it can pave the way to more substantive discussions on project financing. A project void of a turbine deal will find it difficult to convince bankers to finance the project. The types of turbines used can also impact the overall price of the loan — . Cape Wind is expected to cost about $1 billion to develop.

Does today’s news foreshadow a positive announcement by the Department of Energy, which in the next few weeks is expected to decide the fate of what probably is the most contentious green energy project in the U.S. We’ve called Cape Wind in Boston for some clarification.

Vestas, the Danish turbine maker with deep offshore experience, was also in the running for the Cape Wind contract, as G.E.R. reported earlier.

Cape Wind President Jim Gordon said the agreement with Siemens was a major “step forward to jump starting the American offshore wind industry.”

Faced with a powerful opposition, Cape Wind has become unparalleled at communicating about its project. Announcing the turbine deal today, when offshore dominated the news cycle, was a bold PR move.

Although officially neutral, Interior Secretary Ken Salazar has made no secret about wanting to open the U.S. offshore to wind farms. At the state level Massachusetts Governor Deval Patrick is also a strong backer of the project.

Image: iStockphoto

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