June 22, 2012
Scotland

Customers face bill for wind farms’ closure

By Iain Ramage | The Northern Times | www.northern-times.co.uk 21 June 2012

Electricity customers will get a bill for an undisclosed sum for a 10-day shutdown of the Kilbraur wind farm, Strath Brora.

That will be in addition to the £140,000 they will pay to compensate the neighbouring Gordonbush scheme for not producing electricity for three days, a fortnight ago.

The Kilbraur bill, to be passed on by its Italian owners Falck, will cover shutting down its turbines between 11th and 20th June to allow essential power line upgrade work in the Highlands.

The penalty paid to Gordonbush owners Scottish and Southern Energy (SSE) – Britain’s biggest power company – will be in the form of so-called “constraint payments” which are regularly paid in huge amounts to compensate firms for shutting down operations to maintain a safe balance of electricity on the National Grid.

The region’s existing cabling can no longer accommodate the growing input of electricity generated by wind farms.

Industry watchers are furious that SSE will get £140,000 for the Gordonbush episode as it was only producing a limited amount of electricity at the time.

The newly-built 70-megawatt scheme was still running tests before officially coming on stream on 12th June.

An SSE spokeswoman confirmed the Gordonbush scheme was undergoing “final testing” and “wasn’t generating fully”.

Constraint payments have added around £16 million to customers’ bills in the past two years.

While thousands of Scots families struggle to heat their homes, SSE recently announced record profits of more than £1.3 billion.

When asked by the Northern Times for a comment, Scottish energy minister Fergus Ewing passed the matter on to colleagues.

In a subsequent statement, a Scottish Government spokeswoman said: “Scotland has astounding green energy potential and vast natural resources, and we have a responsibility to make sure our nation seizes this opportunity to create tens of thousands of new jobs and secure billions of pounds of investment in our economy.

“Constraint payments highlight that the grid must be upgraded to avoid unnecessary costs to customers.”

John Constable, director of the Renewable Energy Foundation, a UK charity that publishes energy data, said: “The consumer gets hit whatever happens – constraint payments if the grid isn’t built and the cost of the grid if it is.

“Extensions add roughly five to 10 per cent of the capital cost of the grid annually for the lifetime of the asset, which is about 30 years.

“In other words, if you spend £1 billion on grid extensions and reinforcements, then you add about £75 million a year to bills. That’s a total of about £2 billion over the lifetime of that grid asset.”

Allan Tubb of the LandScape protest group, which opposed the construction of several local wind farms, said: “With increasing energy bills, the UK and Scottish Governments must urgently overhaul the system of payments made to an industry that is driving people into fuel poverty.”

Retired Caithness construction consultant Stuart Young, who monitors the industry on a daily basis, added: “We can expect much more expensive electricity from wind without even getting the electricity.”

It is understood that Falck pays the National Grid around £1.5 million a year for its network connection.

A spokeswoman for the company said: “As we pay charges to remain connected, we will probably be entitled to a rebate of these charges for the period that connection was not possible, although the amount has not yet been established. This sort of routine maintenance happens from time to time.”

There is mounting pressure on energy regulator Ofgem to clamp down on a system that has been known to allow power companies more in compensation than the initial value of electricity on offer at the time of an overload emergency.

The highest constraint payment on a single day – 11th September last year – was £1.7 million, when 14 wind farm owners were compensated for switching off a total of 4,650 megawatt-hours of electricity capacity.

An Ofgem spokesman said: “We have long-standing concerns about constraint costs.

“This is why we welcome the Department for Energy and Climate Change’s (DECC) consultation on Ofgem receiving more powers to ensure generators do not abuse their position when constraints occur.”

The DECC claimed the impact of constraint payments amounted to “no more than a few pence per year” on a typical electricity bill.

URL to article:  https://www.wind-watch.org/news/2012/06/22/customers-face-bill-for-wind-farms-closure/