Prysmian seeks assurances before building Somerset plant

THE PRYSMIAN GROUP says it wants to push ahead with plans to open a manufacturing facility at Brayton Point in Somerset to serve the emerging offshore wind industry, but it wants assurances before doing so.

“To invest, Prysmian needs certainty that future Massachusetts projects will utilize local assets such as in-state manufacturing,” said Hakan Ozmen, an executive vice president of the company, in a filing with state officials.

The unusual request raises legal issues about how far a state can go in directing a contractor to use certain vendors.

The stakes are high. Prysmian, which is based in Italy and operates plants around the world, said at the end of 2021 that it wanted to build a $257 million facility at Brayton Point capable of manufacturing and delivering submarine transmission cable to offshore wind farms. The company said it expected to employ 160 to 200 people at the plant.

Prysmian moved forward in tandem with Avangrid, which promised to buy cable from Prysmian for its Commonwealth Wind and Park City wind farms. Both wind farms are now in doubt as the company says economic conditions have changed so significantly that it will be unable to obtain financing for the projects under the current terms of the existing power purchase agreements with the states of Massachusetts and Connecticut.

The company is looking to terminate those agreements and move forward with the wind farms in upcoming procurements. State officials in Massachusetts so far have been reluctant to embrace that approach, and Sen. Michael Rodrigues of Westport, the head of the Senate’s budget committee, has suggested Avangrid should be banned from future procurements if it reneges on the existing contract.

Ozmen said the Avangrid situation has created “considerable uncertainty in Prysmian’s order volumes,” but he said Prysmian nevertheless wants to move forward with the Brayton Point manufacturing facility and may even double its capacity there if the state mandates in future procurements that wind farms winning Massachusetts procurements must source their materials from local manufacturers.

Ozmen said the additional investment will generate more jobs and make Massachusetts “a central and lasting player” in the emerging offshore wind industry.

“The future investment is dependent on the existence of a sustainable market,” Ozmen said. “To invest, Prysmian needs certainty that future Massachusetts projects will utilize local assets such as in-state manufacturing. We also recommend that the Commonwealth plan for sequencing of projects to maximize in-state benefits.”

Ozmen said the state should set “local content requirements” and identify “strategic in-state assets to be utilized by developers as part of the award.”

Ozmen’s comments were submitted as part of a state request for feedback on an upcoming offshore wind procurement.

The town administrator in Somerset, Mark Ullucci, could not be reached for comment.

Officials from the New Bedford area, led by Mayor Jon Mitchell, submitted their own comments calling on state officials to be more forceful in demanding that bidders on upcoming procurements include onshore supply-chain investments.

The letter from New Bedford-area officials says Massachusetts has fallen behind other states in the quest for onshore investments.

The letter said “New Jersey, New York, and Maryland have succeeded in attracting investment primarily by assigning weight to investment commitments in the bid scoring process, a practice that Massachusetts to date has eschewed. The Commonwealth instead has prioritized achieving the lowest possible price of electricity, at the cost of incentivizing in-state investment.”