Today’s announcement from DECC that it intends to cut financial support to onshore wind could leave thousands of British jobs and millions of pounds worth of investment hanging in the balance. It also means the security of the UK’s future clean energy supplies is being jeopardised as a result. We call on the UK Government to think carefully before implementing any cuts in financial support to onshore wind.
Amber Rudd today announced the current financial support mechanism, the Renewables Obligation, will close for onshore wind on 31 March 2016, with limited exceptions. This closure is earlier than expected as DECC said in October the support would continue until the end of March 2017.
RenewableUK Cymru has already called on Amber Rudd to consult with Welsh Government before making any changes but it appears those pleas have gone unheard. David Clubb, Director of RenewableUK Cymru said: “The Government’s decision to end prematurely financial support for onshore wind sends a chilling signal not just to the renewable energy industry, but to all investors right across the UK’s infrastructure sectors.
“It means the Government is quite prepared to pull the rug from under the feet of investors even when this country desperately needs to clean up the way we generate electricity at the lowest possible cost, which is onshore wind. People’s fuel bills will increase directly as a result of this Government’s actions. If Government was really serious about ending subsidy it should be working with industry to help us bring costs down, not slamming the door on the lowest cost option.
“Ministers are out of step with the public, as two thirds of people in the UK consistently support onshore wind. Meanwhile the Government is bending over backwards to encourage fracking, even though less than a quarter of the public supports it.
“We are calling for the Energy Secretary to hold immediate talks with the wind industry so the impact of these cuts can be managed, or at least reduced. We note the Government is allowing some flexibility – so-called ‘grace periods’ – to allow projects where significant investment commitments have already been made in good faith to proceed as planned. But this still means many much-needed projects will be lost unless the cut-off points for financial support are reviewed and extended.”
Wales gains over £799 million of economic benefit from its local onshore wind industry. In the UK 19,000 people owe their livelihoods to the UK’s onshore wind industry – this could have increased to more than 37,000 by 2023 if Government policy had remained supportive.
Senior economists in the sector have calculated bill payers could end up paying £3 billion more because of commitments to meet binding targets after curtailing the cheapest technology, which is onshore wind.