Contract negotiations over Rhode Island’s proposal to buy 200 megawatts of electricity from SouthCoast Wind are taking longer than expected. Pictured is the Block Island Wind Farm. (Photo by John Moore/Getty Images)
Gov. Dan McKee’s newly unveiled fiscal 2026 budget touts Rhode Island as a “key player” in the offshore wind sector, citing the state’s intent to buy 200 megawatts of wind-powered electricity from a wind farm planned off the coast of Martha’s Vineyard.
But Rhode Island’s utility company hasn’t actually inked the deal with the SouthCoast Wind developers. In fact, the deadline to sign the contract has been pushed back again, with negotiations between Rhode Island Energy and the wind project developer now expected to wrap up by March 31, according to an updated timeline posted on the state’s offshore wind procurement website.
When Rhode Island Energy unveiled its tentative power purchase agreement with SouthCoast Wind developers in September, it pegged Dec. 31 as the deadline to seal the deal. Then, the deadline was moved to Jan. 15.
On Thursday, Jan. 16, Rhode Island Energy again announced a delay in the contract signing.
“The revised schedule aligns with the negotiations SouthCoast Wind is concurrently having with the Massachusetts electric distribution companies,” the company stated in a post on the wind procurement website.
Massachusetts has already called dibs on the bulk of the energy generated from the 1,287-megawatt project, tentatively agreeing to buy 1,087 of “nameplate capacity.” Rhode Island, which teamed with both Massachusetts and Connecticut to coordinate their solicitations for more offshore wind power, agreed to buy the remaining 200 megawatts, subject to contract negotiations.
Rebecca Ullman, a spokesperson for SouthCoast Wind, confirmed the developer supports the extension.
“The multi-state context continues to be a pioneering and ambitious approach and it is also complex,” Ullman said in an emailed statement on Friday. “SouthCoast Wind looks forward to our continued collaboration with our Massachusetts and Rhode Island partners.”
SouthCoast Wind and Rhode Island Energy did not address questions regarding the effect of the incoming, anti-wind presidential administration on negotiations. President-elect Donald Trump has already signaled his intent to halt leases, and potentially construction, of offshore wind projects up and down the East Coast.
Patrick Crowley, a labor organizer and co-chair of Climate Jobs Rhode Island, wasn’t worried about the Trump effect.
Crowley cited bureaucracy and the complexity of the deal, which involves utility companies in Massachusetts and in Rhode Island and an international developer, as a more plausible reason for the delay.
“It’s like any other massive construction project,” Crowley said in an interview on Friday. “They’re always delayed.”
The Rhode Island Office of Energy Resources also downplayed the significance of the delays.
“A negotiation for a major project can be a complex and lengthy process,” Robert Beadle, an office spokesperson, said in an emailed response Friday. “Due diligence is being conducted by all parties to ensure that they are able to reach a mutually beneficial agreement.”
Bureau of Ocean Energy Management approves construction and operations plans
Unlike other proposed wind farms still under review before federal regulators, SouthCoast Wind has most of its federal approvals lined up already. The Biden administration on Dec. 20 gave the go-ahead to the developer to proceed to construction, following a rigorous environmental review. And on Friday, the U.S. Bureau of Ocean Energy Management announced approval for SouthCoast’s more detailed construction and operation plans.
“Obviously, this is very timely considering the inauguration on Monday,” said Amanda Barker, Rhode Island lead for New England for Offshore Wind. “I think they’re rushing to try to get this out the door. There is an element of risk, of uncertainty with the new administration.”
SouthCoast CEO Michael Brown described the most recent federal green light differently.
“Receiving today’s final Bureau of Ocean Energy Management (BOEM) approval keeps SouthCoast Wind on track to delivering reliable, domestic energy to New England’s homes and businesses,” Brown said in a statement Friday. “We are grateful to BOEM for their diligent and rigorous review of SouthCoast Wind, and to the many supporters and community members that participated throughout the federal permitting process. SouthCoast Wind will create thousands of union jobs over the life of the project and generate $3.8 billion in new economic activity.”
The contract would set the price per-megawatt hour that Rhode Island Energy agrees to pay the developer. Supply chain snafus and inflationary pressures have driven up developer costs, prompting some companies, including SouthCoast, to renege on existing pricing agreements in hopes of a more lucrative deal. That, in turn, has put more pressure on utility companies — and ratepayers — to cover their rising expenses.
A prior attempt by Rhode Island Energy in 2023 to buy more offshore wind power was canceled after the only submission, from Danish wind giant Ørsted A/S, was deemed too expensive relative to environmental and economic benefits.
It’s like any other massive construction project. They’re always delayed.
– Patrick Crowley, a labor organizer and co-chair of Climate Jobs Rhode Island
Despite past problems with cost, Crowley was optimistic the latest proposal would advance.
“It could be anything from material shortages to where the commas go in the agreement,” he said. “A three-month delay, or a six-month delay is not an indication that something’s going to fall apart.”
Construction on the 147-turbine acre wind farm is slated to begin in 2026, delivering power to the electric grid by the end of the decade.
Assuming Rhode Island Energy completes contract negotiations by March 31, the proposed pricing agreement and estimated revenue would be submitted to the Rhode Island Public Utilities Commission by May 9, according to an updated timeline. Utility regulators have final authority over long-term renewable energy contracts under state law.
Also outstanding is state regulators’ approval on the underwater cables connecting the wind farm to land. The developer has proposed running transmission lines from its wind farm 30 miles south of Martha’s Vineyard up the Sakonnet River, over Portsmouth and out Mount Hope Bay to reach land in Somerset, requiring review by the Rhode Island Energy Facility Siting Board. The board is still waiting on recommendations from a host of advisory groups, due in February, before making its decision.
A separate regulatory body, the Rhode Island Coastal Resources Management Council, also has to OK a permit application for the transmission lines. The CRMC is taking public comments on the permit application through Jan. 20. A vote on the application has not been scheduled.
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