National Grid struck a 20-year deal with wind developer Deepwater Wind that will help a small proposed wind project off the coast of Rhode Island move forward, Gov. Don Carcieri announced Wednesday.
The utility agreed to buy power from the wind farm, which is proposed as up to eight turbines built off the coast of Block Island, for 24.4 cents per kilowatt hour in the first full year of operation. The deal is important because it secures a buyer for power the project would generate.
"Investing in renewable energy reduces our exposure to the volatility of energy prices on the world market, and this agreement establishes confidence in the financial feasibility of the project," Carcieri said in a written statement.
Carcieri, a Republican, has set a goal of getting 15 percent of the state's energy from wind. He and other supporters of the project also say it will help fuel a renewable power industry and create jobs badly needed in Rhode Island, which has one of the worst unemployment rates in the nation.
The deal must still be approved by the Rhode Island Public Utilities Commission.
Deepwater Wind CEO William M. Moore called the deal a critical step in building what could be the nation's first offshore wind farm.
The project is the smaller of two wind farms proposed by Deepwater Wind off the Rhode Island coast. It would provide power for Block Island, a small resort community that pays some of the nation's highest electric rates.
The other project would involve the construction of about 100 turbines, and needs a separate power purchase agreement.
There are efforts in several states to build offshore wind farms, including in neighboring Massachusetts, where there has been a yearslong battle over a proposed project off the Cape Cod coast, and in Delaware and Texas.