Avangrid cancels power purchase agreement on Park City Wind project

Avangrid Inc. (NYSE: AGR) announced it was terminating its power purchase agreements for the Park City Wind project, an 804-megawatt offshore wind project based in Bridgeport that was designed to handle 14% of Connecticut’s electricity supply needs.

“After exploring all potential solutions to the financial challenges facing the project, and engaging in good-faith and productive discussions with Connecticut state officials regarding these challenges, it is clear the best path forward for Park City Wind is in the termination of the Power Purchase Agreements and a rebid of the project,” said the Orange-based company, which owns the United Illuminating utility. the statement, issued at 7:41 p.m.

“One year ago, Avangrid was the first offshore wind developer in the United States to make public the unprecedented economic headwinds facing the industry including record inflation, supply chain disruptions, and sharp interest rate hikes, the aggregate impact of which rendered the Park City Wind project unfinanceable under its existing contracts,” the company continued. “Since that time, Avangrid has been transparent and collaborative, working diligently with state and federal officials and stakeholders to find solutions to the economic challenges facing Park City Wind as we continued to advance the permitting and development of the project.”

Avangrid added that following the study of “all potential solutions to the financial challenges facing the project, and engaging in good-faith and productive discussions with Connecticut state officials regarding these challenges, it is clear the best path forward for Park City Wind is in the termination of the Power Purchase Agreements and a rebid of the project. Pursuant to the contracts, Avangrid and the Connecticut Electric Distribution Companies have agreed to terminate the PPAs which will allow all parties an opportunity to pursue an expedient path forward.”

On Monday, Avangrid announced a similar termination of its offshore wind contracts in Massachusetts, where it was developing the SouthCoast Wind project.

Avangrid’s announcement creates a new obstacle in Connecticut’s path to achieving a zero-carbon grid mandate by 2040. Gov. Ned Lamont did not publicly comment on the company’s decision or how it would impact his clean energy goals for the state.