Wind farms are once again a viable option for UK farmers and land owners who want an extra revenue stream. This is in part due to rising cost of electricity imported from overseas.
Wind power is one of the cheapest and cleanest sources of energy, and the UK has been developing onshore wind farms since the 1990s. The key figures provided by the UK Government state the operational capacity to be 8GW of operational capacity, making onshore wind one of the UK’s greatest renewable energy sources.
Wind power covers about 5.6% of the country’s electricity demands. Scotland is home to more than 60% of the UK’s current, permitted, and planned onshore wind farms (by capacity). In project development, manufacturing, building, operations, and servicing, the onshore wind sector today employs over 13,600 people in the UK. According to the Government, onshore wind significantly contributes to reaching the UK’s decarbonization and renewable energy targets.
On the other hand, the Government has reversed course on onshore wind policy, pledging to “stop the growth of subsidized onshore wind farms”. They are proposing significant adjustments to onshore wind subsidies and planning laws.
Currently, the UK has around 8,600 onshore wind turbines in operation, with another 2,300 offshore.
In 2020, wind power accounted for 24.8 percent of the electricity generated in the UK, surpassing coal in 2016 and nuclear in 2018. Wind power is the UK’s most important source of renewable energy.
To encourage landowners to build wind turbines, the UK government gave a special subsidy known as the ‘Feed-in Tariff.’ A feed-in tariff compensates you for the excess energy you generate at home and send to the National Grid using equipment such as solar panels or wind turbines. “Feed-in tariff” rates vary and are intended to promote investment in renewable energy. The FIT can help you save money on your energy bill.
How did Feed-in Tariffs work?
The FIT program was established to encourage UK farmers and landowners to invest in renewable or reduced energy generation technologies such as solar panels, wind turbines, hydroelectric turbines, anaerobic digestion, and micro combined heat and power systems (micro-CHP)
FIT payments were expected to last at least 20 years under the system. However, to meet the criteria, the installation required a peak output of no more than 5 megawatts or 2 kilowatts for micro-CHP.
As per the official guideline issued by The Office of Gas and Electricity Markets for availing FIT, solar PV, or wind projects with a Declared Net Capacity (DNC) of 50kW or less required Microgeneration Certification Scheme (MCS)-certified equipment fitted by an MCS-certified contractor or an equivalent. At the same time, owners of solar PV, or wind projects with a DNC of above 50kW and a Total Installed Capacity (TIC) of up to 5MW and hydro facilities of any capacity up to 5MW, had to apply for ROO-FIT accreditation to Ofgem.
Unfortunate decision to scrap the Feed-in Tariff subsidy payment:
FiTs, which were first implemented in 2010, functioned as a motivator to encourage the adoption of solar systems by companies and homes alike. However, since April 1, 2019, the Feed-in-Tariff program is no longer accepting innovative solutions for subsidies for excess power provided by solar panels and wind turbines.
On August 27, 2015, the Department of Energy and Climate Change (DECC) began a consultation on the future of the Feed-in Tariffs (FITs) program. The consultation offered a variety of actions to achieve two primary goals. To start with, it was necessary to adhere to the EU State Aid commitment that the UK Government would assess the FITs scheme’s assistance every three years.
This guaranteed that the Government does not compensate generators above the EU Commission’s agreed-upon values. Second, in response to higher-than-expected deployment levels, the Government announced suggestions to manage the scheme’s costs and limit the impact on customer bills. As the cost of deploying renewable energy decreased, subsidy levels would decrease as well.
FITs have played a vital role in promoting investors in developing small-scale renewable sources of energy. DECC had witnessed a considerable rise in deployment levels in home-scale solar and wind turbines and in projects pre-accrediting (securing funding) after the survey’s introduction, before the method was withdrawn on October 1 as part of prior cost containment measures. Across all approved technologies, the plan presently supports approximately 780,000 installations totaling 4.2 gigawatts (GW) of renewable power-producing capacity.
FITs were one of the renewable energy programs supported by the Levy Control Framework (LCF), which was created to keep the costs of providing low-carbon power under control and paid for by customers through their energy bills. On the other hand, the Government was adamant about delivering a low-carbon future that met both the UK’s international responsibilities and local goals. The Government also acknowledged the vital role FITs have played in attracting non-energy professionals to the electricity market and how small-scale generation can potentially play in achieving subsidy-free deployment.
This pressured the Government to extend the FITs plan beyond January 2016. New tariffs that gave reasonable rates of return within a constrained budget, according to the Government, would allow deployment to proceed while giving bill payers much greater value for money. Until the generating tariffs expired in 2019, the plan was reviewed to ensure that it met its goals.
Consequences of the decision
Former Prime Minister David Cameron initially restricted it in 2016, following pressures from Conservative MPs who claimed that wind turbines were an inconvenience in remote regions. It signaled broader climate inaction at the time: investment in green energy plunged by 56 percent the following year, the highest loss of any country on the globe in 2017.
The 2016 prohibition resulted in a significant reduction in onshore wind farms in the United Kingdom. Compared to the 400 farms that started five years ago, only one new farm was launched last year, even though a record 78 percent of the British population favor onshore wind, according to a poll done by the Department for Business, Energy & Industrial Strategy (BEIS).
Many industry experts, including Emma Pinchbeck, the Executive Director of RenewableUK, called this cancellation a “major blow” to industries across the UK, with the small-scale industries being affected the worst. The UK government was also criticized for introducing new policies relatively late, despite knowing that the Government would be canceling FITs. The Government also faced backlash for lack of adequate planning, creating a policy gap between the pre-FIT and post-FIT eras.
Trade unions also reported a decline of approximately 33% in renewable energy sector jobs due to this cancellation.
UK communities embraced Onshore Wind
Cameron said in 2014 that the majority of Conservative Party voters were opposed to the construction of onshore wind farms. However, by mid-2019, a major shift was seen as the Conservative Party’s MP began to urge for a review on policy. A survey conducted on behalf of the Conservative Environment Network showed that three-quarters of Conservative voters favor onshore.
The Parliamentary Scientific and Technological Committee weighed in on the topic in August 2019, questioning the Government’s net-zero goals and declaring them unattainable until action is made. It called for more to be done to make new onshore wind more accessible, citing its environmental and cost-effective benefits.
The restriction was reversed in March 2020 by Prime Minister Boris Johnson’s Government when he allowed the onshore wind producers to participate in auction. He also ensured that the capacity of the network would be considerably enhanced by 2025. Cameron’s move, however, had an impact, resulting in an 80% decline in new onshore wind projects by 2019, with the number of new turbines coming online at an eight-year low.
Future of Onshore Wind turbines
The United Kingdom has lifted a four-year restriction on onshore wind farm subsidies.
It means businesses will be allowed to compete for government contracts once again, boosting investment in land-based wind turbines, one of the most cost-effective methods to generate renewable energy. It’s a decision that will help the country get closer to its goal of achieving net-zero carbon emissions from 2022 onwards.
The subsidies are government contracts that guarantee a price for the energy generated once the wind farms are completed, removing a large amount of risk from the investment. Businesses can then bid for the contracts in an auction next year, with projects expected to be completed midway through the decade.
Wind power surpassed nuclear energy for the first time in 2018, and currently accounts for around 20% of all electricity in the UK. According to the research, renewable energy accounts for nearly a third of all power in the United Kingdom. However, the Government expects 70% of power to come from renewable sources, including wind power, by 2050.
A spokesperson from the nonprofit organization Friends of the Earth stated that renewable energy is vital to reduce greenhouse gas emissions in the UK, which is essential for the survival of people.
The spokesperson also emphasized how wind energy is one of the most feasible yet cost-effective forms of energy. This only reiterates the importance of onshore wind turbines that play an effective role in providing the UK with clean and renewable energy, saving fossil fuels and the climate.
If you are UK land owner then we would love to have a chat about developing a wind farm on your land, to provide you and your family with a new income stream, as well as helping save the environment for this and future generations.
Contact us today for a chat.