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Spotlight on UK onshore wind market, Part I


REFocus contributor Andrew Mourant examines the dynamics and policies impacting the onshore wind industry in the UK.

These are bruising and uncertain times for the UK’s onshore wind energy industry. There’s been hostility within government, and schemes around Britain have foundered on politics. Where communities have been allowed a voice in whether or not turbines should be built, the political decision-maker, Secretary of State for Communities Eric Pickles, has usually sided with opponents.

But soon Pickles will no longer be a roadblock to small (<50 MW) local schemes. In May, a general election beckons; the result impossible to predict. Any alliance between Conservatives (the dominant party in a five-year coalition with Liberal Democrats) and the burgeoning UK Independence Party (UKIP) will be bad news for onshore.

Yet if Labour, the Scottish Nationalist Party (SNP), the Greens and Liberal Democrats formed any sort of rainbow alliance, things could be very different. Neither scenario is impossible.

Last spring the Conservatives announced they’d no longer subsidise new onshore wind farms. Former Energy Minister Michael Fallon said Britain would already have enough wind power to meet 2020 European Union (EU) targets. Post-election, subsidies for on-shore renewables will be cut by 5% each year for three years; then 9% the year after.

Another change is that local council planners in England and Wales will determine new applications. Currently, bigger projects are dealt with under the "nationally significant infrastructure" planning regime.
Figures from the Department for Energy and Climate Change (DECC) suggest that 13.8GW of UK onshore wind power capacity is already built, under construction, or been granted planning permission – enough to power seven million homes by 2020. That, the government says, will meet targets of 11-13GW, even if some projects fall through.

In April 2014, Pickles extended for a further 12 months his powers to have the final veto over disputed small on-shore projects — his response to ‘continuing concerns in communities.’ He claimed ‘insufficient weight’ was given to factors such as landscape and heritage, and that the need for renewable energy ‘should not automatically override’ such concerns.

A recent analysis by the magazine Planning Resource has concluded that Pickles would have approved a further 50 onshore turbines in 2014 had he not rejected appeals against the advice of planning inspectors.
The onshore industry has been quick to shout ‘double standards’. It says Pickles has applied far more draconian criteria to onshore wind than to shale gas prospectors — there’s little doubt many Conservatives have been seduced by what they see as the quick-fix potential of fracking.

Detailed manifestos on energy policy have yet to appear, though it’s already clear what can be expected from parties, major and minor. Given the fluid state of British politics, and the strong possibility deals will have to be struck, this matters more than usual.

Where the parties stand

UKIP speaks of the ‘folly of wind’, ‘massive subsidies on the actual turbines.’ It makes dire warnings of green levies adding a third to household electricity bills by 2020; ‘of an unpredictable and intermittent trickle of very expensive electricity, requiring 100% back-up’. UKIP leader Nigel Farage is pro-nuclear, pro-gas, pro-fracking — anything but pro-renewable.

By contrast, the Green Party vows to accelerate onshore and offshore wind power generation ‘at rates sufficient to ensure the change to a stable electricity-based energy system of 87GW by 2030.’ “This will require a rapid build of onshore,” the Greens add.

What of Labour’s plans? To date, only a piecemeal picture has emerged. Last April, leader Ed Miliband spoke of Britain needing to embrace onshore wind, suggesting an audit of the windiest places as a guide to where turbines should be sited. But little more has been heard of this.

Labour’s headline-grabber is to cap energy prices – which has provoked a rash of extreme reactions; it has also opened up the market to small producers. Shadow energy minister Caroline Flint endorses the Feed-in-Tariff system that helped make this possible in Germany. She favours Germany’s ‘grid priority access’ for renewables — solar and wind are the first sources fed into its energy grid system.

The Liberal Democrats appear to be diehard enthusiasts: climate change secretary Ed Davey has condemned wind’s ‘ever shriller’ opponents. “If you have a policy against onshore, you’ll be making a mistake of historic proportions,” he stated. “Without it, the contribution of renewables to energy security would be considerably cut.” He would scrap Pickles’ power to rule on controversial proposals and has called for a ‘coalition for renewables.’

The SNP says it will have no truck with Conservatives in terms of power sharing. Since running the Scottish parliament, SNP has overseen a dash for wind power – Scotland is home to more than half of the UK’s operational turbines producing more than 100KW – 2586, out of 4766. Targets have been set to generate the bulk of Scotland’s electricity from wind and wave power by 2020.

However, Murdo Fraser MSP, Scottish Conservatives’ energy spokesman, says wind farms there are “completely out of control. “There’s a place for them, but it’s ludicrous to put such emphasis on intermittent and unreliable energy sources which can damage the landscape,” he noted.

Yet Scotland, reputedly Europe’s windiest country in Europe, is the logical place for any proliferation of onshore farms. Advocates say that reliability of power depends on how well changes in wind power output can be anticipated, rather than wind variability in itself. They claim output forecasts are ‘increasingly accurate’ and that predictable drops can be compensated for by using conventional power stations.

Gemma Grimes, director of onshore renewables at industry body RenewableUK, has accused Pickles of damaging the industry in England. “Reducing his scope to call in projects would significantly improve the planning system,” she stated. “Local growth cannot be held hostage by political whim.”

Meanwhile, the question that remains is: How will onshore ride out declining subsidies? No one expects the reduction to be reversed, whoever’s in power. “We’re moving to a different incentive mechanism,” Grimes noted. “Contracts for Difference (CfD) will place downward pressure on costs for all technologies.” 1

Grimes believes the industry is already competitive in terms of costs, predicting that onshore wind will be the cheapest form of energy by 2020. “It’s already a mainstream part of the UK mix, and reliable when other forms of generation – such as nuclear and gas – are taken off-line for significant periods,” she stated.

What’s ultimately needed, Grimes said, is a stable policy environment. “It’s important for all parties to realise that we can’t afford to move away from onshore wind,” she said. “The industry already provides 19,000 jobs in the UK. It’s developing opportunities for people to directly invest in wind farms.”

Part II of this article will feature a one-on-one with Dale Vince, founder of Ecotricity, who discusses the challenges of executing wind projects in the UK.


1. Under CfDs, due to come into force from 2017, power generators will get the price they achieve in the electricity market plus an agreed 'top-up’ – the 'strike price’. But if the market price exceeds the strike price, the generator will then have to repay that top-up. The government says this offers best value for money and price stability.

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Energy efficiency  •  Energy infrastructure  •  Policy, investment and markets  •  Wind power