Latest Government Announcements

On the 18th June 2015 the Government issued two impotant announcements concerning onshore wind farms.

1. Giving local people the final say over onshore wind farms.

2. Ending new subsidies for onshore wind.

1. The first of these announcements has already been included in National Planning Practice Guidance and sent as a Written Statement to Parliament.

What is clear from this new legislation is the increased weight given to local communities must give their backing to any future proposals for onshore wind farms. This highlights an even greater urgency and importance for all those oppsed to send in their objections and give a clear message to their local authority, in particular the Sewstern Lane wind farm.

 

2. The second of these announcements is even more encouraging, because he Government are ending the Renewables Obligation on the 1st April 2016, a year earlier than originally planned.

The Renewables Obligation or RO is effectively a subsidy paid to wind farms on top of the wholesale electricity price. The RO has been the main driver for the building of wind farms.

In the recent June 2015 statement, Secretary of State Amber Rudd (DECC) is proposing a grace period which would continue to give wind farms support via the RO to those projects which on 18th June 2015, already have;

  • planning consent,
  • a grid connection offer and acceptance,
  • and evidence of land rights for the site

For example: As far as can be seen at present the Sewstern Lane Wind Farm would not meet these criteria and so would not be eligible for the RO subsidy.

This does not mean no subsidy will be possible as there is another subsidy scheme called Contracts for Difference (CfD) which is paid over for 15 years instead of the 20 years for RO.

CfD subsidy is obtained through auctions controlled by the Govt, with the lowest bids winning contracts. There has only been one auction to date (2014) where onshore wind projects accepted income between £79 and £82.50 per MWh. If the same schemes had gained the RO subsidy the income would have been £95 per MWh.

This auction of CfD meant a reduction of about 18% on the cost per MWh, which would significantly reduce income for onshore wind developers. For future CfD auctions it is unclear whether they will be open to onshore wind developers.

Note: The RO and CfD subsidy only apply to wind farms over 5MW and not single turbines which are paid for under the separate Feed in Tariff (FiT) subsidy. The FiT is currently being reviewed by DECC.