Nov. 06-- Nov. 6--BOSTON -- Mayflower Wind Energy has won the bidding war for Massachusetts' second offshore wind contract.
The state's electric companies selected the lowest-cost of Mayflower's four bids, rather than ones designed to invest in port infrastructure or build a new manufacturing facility.
"When it was balanced on whole, this was the one that was most competitive on price and economic development," state energy commissioner Judith Judson told reporters on a press call Wednesday. "Mayflower's package for all their bids included significant economic development."
Mayflower beat Bay State Wind and Vineyard Wind, both of which submitted multiple bids with different selling points.
Local reaction was mixed on the SouthCoast, where leaders have been pushing for local investment from the offshore wind industry in hopes of establishing the SouthCoast as an industry hub.
Anthony Sapienza, chairman of the New Bedford Economic Development Council and former president of clothing maker Joseph Abboud, said Mayflower Wind has been "very aggressive and interesting," but he is disappointed that the utilities selected their lowest-priced bid.
"I think that's a mistake," he said in an interview. "I think, in the Commonwealth, we'll lose our premiere position in the industry and give it up to places like New York and New Jersey, and that's unfortunate."
Another Mayflower bid would have gone a long way toward establishing the industry in Massachusetts, he said.
New Bedford Mayor Jon Mitchell congratulated Mayflower and said he looks forward to working with them, but he would have chosen a proposal with more financial commitments.
"By selecting yet again the bid with the lowest hard-dollar investment commitments, the Commonwealth has clearly signaled a policy approach for securing industry investment that diverges sharply from those of our competitor states," Mitchell said in an email.
He said he disagrees with that policy but welcomes the addition of Mayflower's parent companies, Shell and EDP Renewables, to the Port of New Bedford.
"We will continue our work to establish Greater New Bedford as the East Coast leader in offshore wind through careful planning and marketing, along with our global leadership in commercial fishing," he said.
State Rep. Patricia Haddad, D-Somerset, said she was glad to hear Secretary of Energy and Environmental Affairs Kathleen Theoharides say Mayflower's bid was chosen not only on price, but also because it promised significant economic development.
"I think it's a good thing," she said of the choice. "Actions speak louder than words. Let's see what actually happens."
Haddad said Mayflower has pledged to aggressively seek local partners.
Theoharides agreed, saying the company intends to adopt a "local-first" strategy for its supply chain.
"This was an extremely strong bid, both in terms of competitive pricing as well as in terms of its commitment to economic development," she said.
Judson said the evaluators considered the proposals' direct effect on the local economy, including the number of jobs they would bring, binding commitments they would make, and the overall scale and credibility of the offers.
Electricity distribution companies Eversource, National Grid, and Unitil selected the winner in a state-supervised process created by Massachusetts' 2016 energy diversity law, which required the utilities to buy long-term contracts for at least 1,600 megawatts of energy from offshore wind. Mayflower's winning bid calls for 804 megawatts of generation capacity. Together with last year's 800-megawatt winning bid by Vineyard Wind, the state has fulfilled its procurement obligation under the 2016 law.
Although the Massachusetts Department of Energy Resources participates on the evaluation team, the state votes only if the utility companies are not unanimous. DOER voted in 2018, when Vineyard Wind was the winner, but not this time, an agency official said.
Mayflower Wind President John Hartnett said the project will contribute to the building of a supply chain on the SouthCoast and across Massachusetts.
"We look forward to working with all of our stakeholders to ensure a safe and successful project," he said in a news release.
According to Mayflower, the project will deliver long-term prices below the original price cap of $84.23 per megawatt hour.
State law originally called for each successive price to be lower than the previous contract price, but an amendment to the fiscal year 2020 budget eliminated the price cap that resulted from Vineyard Wind's contract until 2021. Then, the price cap will be back.
Mayflower said the project will create up to 10,000 offshore and onshore jobs and eliminate 1.7 million metric tons of carbon dioxide emissions annually, the equivalent of taking 350,000 cars off the road.
Vineyard Wind CEO Lars Pedersen said he was disappointed not to be selected for a second contract but remains fully committed to the existing Vineyard Wind 1 project.
The utilities have not signed contracts with Mayflower. Wednesday's announcement begins the negotiation phase. The bid schedule calls for contracts to be executed by Dec. 13 and sent to the Massachusetts Department of Public Utilities for approval.
The federal approval process for Vineyard Wind's 2018 winning bid has stalled, leaving the construction timeline for that project uncertain. How that delay could affect Mayflower remains uncertain.
Mayflower Wind Energy is a joint venture of the Shell oil company and EDP Renewables, which is part of the Portuguese energy company EDP (Energias de Portugal).
