Doomed & Desperate: UK Wind Industry Attempts to Engineer Backdoor Subsidies
David Cameron’s Conservatives strode to outright power on the back of a ‘crystal clear’ manifesto to cut subsidies to wind power and to give locals the right to veto wind farm projects at the planning stage.
But, in a ‘never-say-die’ last ditch attempt to obtain ‘backdoor’ access to the perpetual subsidies that are the only reason it exists at all (see our posts here and here), the wind industry – along with its plants in the Department of Energy and Climate Change – have hatched a plan to get around Cameron’s pledge to permanently cut its lifeline.
Humpty Dumpty was famously (and rightly) challenged by a scornful and quizzical Alice for haughtily claiming that he – as ‘Master’ in a ‘Looking Glass’ World – could make words mean whatever he chose them to mean.
Taking its cue from that pompous and brittle egg, the wind industry – in pitching a panicked salvation package – has primed its DECC’s puppets to call a “government guaranteed fixed price for wind power” a “subsidy-free contract”, in what can be fairly described as very scrambled logic.
Revealed: the great wind farm tax ‘con’
13 February 2016
Ministers may break pledge to stop funding onshore turbines with consumer subsidies
Ministers have been accused of planning a U-turn that would see consumersFUND new onshore wind farms through green levies.
Critics described the proposal as a con, and said the Conservatives’ policy had been “crystal clear” that the subsidies would stop.
Under the plan, households would still be forced to pay millions of pounds on their energy bills to fund new wind farms – but the payments would no longer be defined as subsidies.
The wind industry’s plan hinges on the fact that no new power plants are commercially viable to build at the moment without extra financial support from bill-payers.
If wind farms can be built at lower cost to consumers than alternatives, such as new gas plants, then payments toFUND them should no longer be classed as “subsidy”, the industry argues.
Andrea Leadsom, the energy minister, admitted that the proposal for so-called “subsidy-free” contracts would not in fact be “cost free” for bill-payers, but said the Government was “listening carefully to industry on how it can be delivered”.
Opponents called the plan “outrageous” and said that the proposals under consideration would still constitute subsidies.
Owen Paterson, the Tory MP and former environment secretary, said: “Hard-working energy consumers will not be conned by a change in name. The Conservative manifesto was crystal clear that public subsidies for onshore wind will stop.
“There is absolutely no place for subsidising wind – a failed medieval technology which during the coldest day of the year so far produced only 0.75 per cent of the electricity load.”
The Conservatives pledged in their 2015 manifesto to “halt the spread of onshore wind farms” and vowed to “end any new public subsidy” for the turbines.
More than 5,000 wind turbines have so far been built onshore in the UK under efforts to hit renewable energy and climate change targets.
Consumers are already estimated to pay in excess of £800 million a year in subsidies for the turbines, adding about £10 to an annual household energy bill.
David Cameron has said that Britain does not “need to have more of these subsidised onshore”.
But the proposal being considered by the Department of Energy and Climate Change (DECC) would see onshore wind farms continue to qualify for an existing subsidy scheme that guarantees developers a fixed price for electricity generated.
The most recent onshore wind farm contracts awarded under the scheme, early last year, were at prices of about £80 per megawatt hour (MWh) – more than double current market prices of about £35/MWh. Consumers willFUND the difference through green levies on their energy bills.
John Constable, of the Renewable Energy Foundation, a group critical of renewable energy costs, said it would be “outrageous” to regard the proposal DECC was considering as “subsidy free”. “It is justSPIN doctor stuff, it’s playing with words,” he said.
Glyn Davies, the Tory MP, a member of the energy select committee, said: “I don’t think we should be introducing mechanisms that continue with subsidy – just to say there’s no subsidy when there actually is.”
He said he would be “very concerned” if ministers continued payouts to new onshore wind farms.
Fellow Tory Peter Lilley said the wind industry’s proposal “wouldn’t be subsidy-free” and that wind farms should not receive the same support as gas plants, because the power they produced was not reliable and was therefore worth less.
Mr Paterson added: “If we must support energy, we should help develop combined heat and power which increases efficiency from 50 per cent to 80 per cent or we should develop new technologies which actually work.”
A DECC source insisted energy secretary Amber Rudd was “crystal clear that the manifesto commitment to end new public subsidies for onshore wind and give local people the final say is delivered to the letter”.
“Any idea that doesn’t do this is simply not going to get the green light,” the source said.
The influential think-tank Policy Exchange has said that “subsidy-free” contracts should be offered to support the construction of new onshore wind farms in Scotland and Wales, as well as replacing old turbines with new, far bigger ones.
Maf Smith, deputy chief executive of Renewable UK, said it would be “anti-competitive” to bar any technology from competing for the financial support being offered for new power plants.
A DECC spokesman said: “There is no change to our commitment to end new onshore wind subsidies. Our actions have shown that we will be tough on subsidies, in order to keep bills down for our families and businesses.”
Maf Smith has a somewhat confused take on ‘competition’. It’s precisely what David Cameron has given the wind industry a chance to finally experience; with an opportunity toBACK UP its endless (but empty) claims about being cheaper than gas and coal-fired power. Well, Maf? What are you and your paymasters waiting for?
The only reason the UK has to offer any financial support to conventional generators is thanks to the perverse policy that, until now, has guaranteed prices 3-4 times the price of conventional power, for the chaotic, weather-driven delivery of a source that – but for the subsidies it attracts – has NO commercial value.
A rebranded wind farm subsidy is still a subsidy
24 February 2016
The public aren’t fools. If the Government wants them to pay for the construction of inefficient wind farms, let it admit to it
The 2015 Conservative Party manifesto took a clear and sensible stance on the issue of wind farms. It stated that while they can form part of the “energy mix”, they are “unable by themselves to provide the firm capacity that a stable energySYSTEM REQUIRES”. The manifesto pledged to “end any new public subsidy for them”. So it is more than a surprise and a disappointment to discover that the Government is considering a reversal – keeping the subsidies and simply rebranding them.
Popular opposition to wind farms is practical, not ideological. Most people recognise that we need to develop sustainable technologies and reduce pollution. But Britain also needs cheap, plentiful energy – to fuel its economic growth and provide a highQUALITY OF LIFE for all its citizens.
Wind farms often fail to meet these criteria. Some people complain that they despoil the environment by being ugly, loud and deadly to birds. Others point out that they can be desperately inefficient. Britain demands energy most in the winter, to heat our homes. But at this time of the year it is often windless, despite recent storms. The turbines stand still and useless – a complete waste of the generous subsidies that come from levies on consumers’ energy bills. To make matters worse, when the wind blows too hard, the Government actually pays the industry to turn the turbines off. Strong wind conditions in late January threatened to overwhelmTHE GRID with more power than was needed – so the National Grid offered lucrative payouts of between £58 and £115 per MWh to shut down the supply.
If the Government believes there is a case to be made for continuing to subsidise the industry then it should make it openly and honestly. What the public does not want to hear isSPIN – which is what the proposal of redefining a subsidy amounts to. Lobbyists say that any new onshore wind farms will cost less to build than the old, non-renewable plants they are replacing, so they are a fair deal. Yet not only will the new turbines be less efficient than gas or coal, but there is also no escaping the conclusion that hard-pressed consumers will still be bank-rolling the expansion of a controversial energy source through their domestic bills. We sincerely hope that the Government rejects any advice to rebrand this arrangement as subsidy-free. The public deserves transparency in this debate.