January 26, 2012
Scotland

Wind farms paid £14m by National Grid for switching off turbines

www.scotsman.com 26 January 2012

Scottish wind farm operators received more than £14 million in the past two years in return for switching off their turbines, it has been revealed.

Since 2010, a system of “constraint payments” has been operated by the National Grid to compensate windfarms if they are taken off the grid when it cannot cope with high supply.

A breakdown of the payments made to wind farms has been published by the Renewable Energy Foundation (REF), a charity that has been sceptical of wind power. It believes the data should be made public.

All the 15 wind farm sites paid constraint payments are in Scotland. They received a total of £14,249,194 in compensation in the past two years.

The 40-turbine Farr Wind Farm, near Inverness, which is operated by nPower renewables, received the highest payment, of more than £2.3m.

The lowest payment went to ScottishPower Renewables’ 60-turbine Arecleoch Wind Farm in South Ayrshire, which received £24,584.

The REF claimed the figures showed that the price of the constraint payments was often many times more than the loss in subsidy payments for wind farms, which are withdrawn for the period when they are taken off the grid, “suggesting that the market is not functioning in the consumer interest”.

Dr John Constable, director of REF, said: “The introduction of opaque trading arrangements to manage wind power is a very unwelcome step in the wrong direction and must be reversed without delay.

“It is time for the regulator, Ofgem, to step in to protect the consumer interest by ensuring UK electricity markets become more transparent, not less.”

The overloading problem in Scotland is a result of a lack of capacity in the grid to carry the electricity generated by growing numbers of renewable energy schemes.

Responding to REF’s figures, Catherine Birkbeck, grid and markets policy manager at Scottish Renewables, highlighted that all energy producers received constraint payments, not just wind farms.

“All electricity generators, including coal and gas power stations, are paid not to generate at times of lower than expected demand or when there is congestion on the grid,” she said.

“The payments made to renewables are tiny compared to what is paid to fossil-fuelled electricity generation.

“Scottish Renewables is working closely with National Grid to address how the industry can work with the regulator to ensure constraint payments are kept to a minimum.” She also questioned REF’s agenda, pointing out that it is a “well- established anti-wind farm group”.

Overall constraint payments to all types of generators, including fossil fuel firms, totalled £708m for the financial year 2010-11, and consumer groups recently called for a cap to be put on the payouts to energy firms.

A spokesman for energy regulator Ofgem said: “We are reviewing the rules around generator behaviour when transmission constraints are active.”

A National Grid spokesman said that it used various trading agreements and tools to control costs. He added: “They help keep prices, to manage constraints and balance the electricity transmission system, as low as possible.”

URL to article:  https://www.wind-watch.org/news/2012/01/26/wind-farms-paid-14m-by-national-grid-for-switching-off-turbines/