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Despite recent headwinds, Vineyard Wind has activated its power contracts with utility companies, setting fixed prices for the offshore wind project’s electricity over the next 20 years.
In a press release Monday, the Healey administration said the contracts, called power purchase agreements, will save Massachusetts ratepayers about $1.4 billion in electricity costs over this time.
“Throughout one of the coldest winters in recent history, Vineyard Wind turbines powered our homes and businesses at a low price and now that price goes even lower with the activation of these contracts,” Gov. Maura Healey said in a statement.
Vineyard Wind has been selling power to the market since 2024, but at fluctuating and at times higher prices.
As of Monday and for the next year, the price will be fixed at $69.50 per megawatt-hour as the 800-megawatt project feeds into the regional grid, which demands thousands of megawatts at a given time. (Vineyard Wind’s output will also be variable throughout the year.)
Healey’s office said the power purchase agreements are expected to provide customers in Massachusetts an average savings of 1.4 cents per kilowatt-hour on their electric bills, “at a price that’s less than half of peak pricing we saw this winter.”
The administration’s press release, however, didn’t actually list the price for Vineyard Wind’s energy. After a follow-up query, a spokesperson with the Massachusetts Energy and Environmental Affairs Office confirmed to The Light that the prices are $74 and $65 per megawatt-hour for each 400-megawatt half of the project.
Together, that averages to $69.50, the spokesperson said. Each year, it’ll increase 2.5%.
Dan Dolan, president of the New England Power Generators Association, called it a “remarkable” figure. Agreements reached later than Vineyard Wind’s, or which are being negotiated today, are coming in at a much higher price.
Still, he noted the subject is complicated: it’s neither a wholly good deal, nor a bad one.
This past winter, the market price for wholesale electricity was expensive, Dolan said, often exceeding $100 per megawatt-hour. Compared to those prices, Vineyard Wind’s nearly $70 contract price “starts looking like an attractive resource for consumers overall.”
“The flip side is a day like today,” he said Tuesday, when it was sunny and reaching the mid-50s in Massachusetts. “Electric demand is relatively low. It’s a beautiful, mild day and wholesale electricity prices are also very low.” On Tuesday, wholesale prices were about $30 per megawatt-hour.
The contracts are between Vineyard Wind and three utility companies: Eversource, National Grid and Unitil. ISO New England is the grid operator.
The price can also be more or less attractive depending on the year.
In recent years, New England saw some of its lowest wholesale electricity prices in some time, Dolan said. But 2022 was expensive due to Russia’s invasion of Ukraine. That year, the Vineyard Wind contract price would’ve been attractive. But in lower-price years, the project’s contract price would have been above market, he explained.
“If you take a snapshot in time, you can make an argument that this is the best deal in the world or the worst,” he said.
According to Healey’s office, Vineyard Wind lowered electricity prices this winter by competing in wholesale electricity markets, offering lower prices than other sources, even before the power purchase agreement took effect.
Still, the Massachusetts Attorney General’s Office previously said that without the power purchase agreement in effect, ratepayers were paying “volatile and expensive” wholesale prices, per filings from the lawsuit against last year’s stop-work order.
“Massachusetts ratepayers will have to pay at least $11 million more in direct wholesale energy market costs between January 2026 and March 2026 without the Project operating at full capacity,” the office wrote a few months ago.
For about one month, the Trump administration’s December order temporarily froze the project’s remaining buildout and thus the amount of energy that could come online from the project.
According to data from the Federal Energy Regulatory Commission, the project’s average price of energy sold in recent quarters — before the stable contract price took effect — ranged from $42 to $104 per megawatt-hour.
How offshore wind can drive down electricity prices
Vineyard Wind can also benefit ratepayers by acting as a price suppressor within the wholesale energy market, experts say.
ISO New England usually dispatches resources in order, from lowest to highest price, until it can satisfy energy demand. The last resource needed to fulfill demand is the price-setting resource (known as the marginal resource). In the chart below, it’s Resource D.
If offshore wind is added to the mix (imagine adding another green column), it can kick out Resource D, making the slightly cheaper Resource C the new price setter.
Multiplying the lower price set by Resource C with the thousands of megawatts in use can amount to hundreds of thousands of dollars, if not more, in cost reductions on a given day, compared to the cost if Resource D stayed in the utilized mix.
In the long term, Dolan said, this suppression could create savings for retail consumers. But in the short term, it depends on how the wholesale market settles.
“This is where it really, really matters what happens in the rest of the market to determine the economic value, on a pure price basis, of these contracts,” Dolan said.
With affordability top of mind for consumers, price matters, he said — but so do the other reasons the state pursued offshore wind: grid reliability from adding another big energy source into the system, economic development (spurring investment in places like New Bedford), and climate goals.
Massachusetts has been counting on offshore wind to meet its ambitious goals for clean energy, including a mandate to reduce greenhouse gas emissions by 50% below 1990 levels by 2030. Vineyard Wind has said the project could power 400,000 homes at peak capacity, though the actual amount of homes powered depends on several factors.
Vineyard Wind’s electricity sales dropped this winter
As recently as this month, the project wasn’t operating at full capacity, according to declarations Vineyard Wind filed in its lawsuit against GE Vernova, its wind turbine supplier. Though Vineyard Wind wrote the project was “capable of generating” up to 780 megawatts of power, it also said turbines were facing routine issues, including tripping of the power systems that would cause them to shut down.
Vineyard Wind’s energy sales dropped nearly 13% in the first quarter of 2026 (January through March) compared to the last quarter of 2025 (October through December), according to new data from the Federal Energy Regulatory Commission. Wind turbines usually generate the most power in winter, when winds are strongest. But this winter, the project still had turbines to commission and bring fully online.
Output can vary on a given day or hour depending on wind speeds, repair work or other offshore conditions.
Vineyard Wind in a statement Monday said the power purchase agreement activation marks a significant milestone, but did not answer other questions, including about the status of the tripping turbines and the drop in energy production in winter.
“The project is delivering reliable energy at stable, affordable prices and is projected to save ratepayers billions in the decades ahead,” said Vineyard Wind spokesperson Craig Gilvarg. “At a moment when the region needs it most, Vineyard Wind is adding significant new energy and strengthening the long-term security of the New England grid.”
The wind developer and utilities entered into these contracts years ago, before Vineyard Wind started construction. But they couldn’t activate until the project reached full operational capacity — a milestone significantly delayed by issues with GE’s turbines.
The early agreements served as an important financing mechanism, ensuring the project could recover its multi-billion construction costs through continued sales to utilities.
Wind industry faces mounting obstacles
Power purchase agreements have been repeatedly stalled for what the state hopes will be its next two offshore wind projects: New England Wind and SouthCoast Wind. The companies and the state energy office have yet to finalize negotiations and agreements, in large part due to the uncertainty created by the Trump administration’s hostility to offshore wind.
As has been a regular pattern during the Trump administration, a win for offshore wind is often accompanied by news of more challenges. In this case, the Interior Department on Monday announced it had struck a deal with another offshore wind company to terminate two of its leases, in California and New York. This brings the total of projects terminated through these agreements to four.
Monday’s deal with Ocean Winds spared the company’s third lease, SouthCoast Wind. The Light contacted the Interior Department Monday seeking comment on the status of SouthCoast Wind.
Michael Brown, CEO of Ocean Winds North America and of SouthCoast Wind said in an email that the company “did not take this decision lightly.”
“When the underlying conditions in a market change, we must adapt,” he said. “In this case, receiving a refund for the lease payments we had invested and exiting on agreed terms was the right outcome for our shareholders and partners.”
Email Anastasia E. Lennon at alennon@newbedfordlight.org.
Stabilizing Electric Rates ? ? ? At best it looks to be about $2.00 a month in savings for each electric customer in Massachusetts. If this is true it’s nothing more than a big green flop and not the savior that wind was promoted to be. Was the financial return from wind really exaggerated and for $2 bucks a month was this really worth affecting our sea life, waterways, and fishing grounds. 100% our state needs new political leadership.
Does anyone think that putting all our eggs into fossil fuels is going to lead to stability in the future?
Diversity of energy sources should be part of the solution…an administration that has targeted wind power and started a war in the Middle East has shown how vulnerable consumers are to global events.
Trump doesn’t run Massachusetts and was not President for the four years when Biden and Healey went balls to wall with Green Energy. Shutting down all other energy resources to bring forward a monthly benefit from wind of $2 Dollars a month is a complete joke and does not help with the major spike in electrical bills. Instead of using common sense and incorporating several types of energy sources to fill our electrical needs our state leadership has failed us miserably. 100% it’s time to move on from Maura Healey, she has run this state into the ground.
Better than paying through the nose and being dependent on Russian gas and Iranian Oil.
Having a guaranteed rate for 20 years certainly will help to stabilize rates. Natural gas prices fluctuate but over 20 years are highly likely to increase far more than 2.5%/year.
And fossil fuels have no effect on sea life, water, and fish grounds??
Good reporting in this article.
Off Shore wind is a cost disaster and shows Gov Healy and her tree huggers don’t give a crap about the working people of the South Coast. By blocking any new gas pipelines and moving to intermittent power which still needs to keep 100% fossil fuel redundancy on standby, they have created the most expensive power stack in the country. The result, along with our state tax structure, industry is heading en masse to the exit.
The experts are wrong wind will always have a direct impact on delivery charges.
Congratulations to Vineyard Wind and hooray for the stability of renewable electricity from offshore wind; emissions free renewable power made right here at home without having to send the Navy halfway around the world! How many trillions of dollars will we have to spend on that?
Thanks to Anastasia for her great reporting!
There is zero transparency in this project. No one is telling us what the actual cost to build, life expectancy of the project, long term environmental impact, etc, etc ,etc is. Your talking about building more offshore wind and you don’t know if the end justifies the mean. I wish I could run a business like this. Get paid even if things don’t work out. Trump is right no more Federal investment in alternative energy too many variables
My comment is this, stop the rhetoric and wait and see how this plays out. The real facts have not been developed. If research was to be done then you should look at Northern Europe and see the success they have had. Offshore wind in Northern Europe is highly efficient, boasting capacity factors often exceeding 50% due to strong, consistent wind speeds in the North Sea. Modern, large-scale projects often operate 340+ days a year, with recent offshore units reaching capacities of 15 MW and technical efficiencies ranging from 83% to 98%. This will either be a success or a failure, but time will tell. This has nothing to do with politics and who you like or dislike. If immediate savings is desired then install solar panels. I have them and average less than 50% of the cost of electricity compared to a few of my neighbors. With solar you don’t pay “transportation costs”, nor do you pay the fees, or whatever you wish to call it, for MassSave. And when you overproduce this creates a credit on your bill with eversource, and by the way if and when you have to use the grid and the credit you still do not pay those costs.
Your welcome to your opinion, to say politics had nothing to do with this is ridiculous. Our left leaning state politicians went for the far left liberal green new deal and a wind project that was sold as the savior for our energy needs. Now to get the news that customers will receive on average a two dollar reduction to their bill every month is a complete joke and won’t help any of us (bills have gone up hundreds of dollars). We can’t waste any more time waiting to see what happens, we need new leadership that will make common sense decisions, and give us hope for a better future.