The government is under intensifying pressure over its wind energy policy with a lobby group threatening legal action and a key investor warning that a planned £200m facility could be at risk.
Renewable UK, the wind power lobby group, said it would consider a judicial challenge if ministers caved in to Tory backbenchers and implemented a major cut in onshore wind subsidies.
Meanwhile, Siemens, one of the last turbine makers still wanting to construct a new blade factory and port complex for the North Sea, has warned that it cannot wait for ever for longterm Whitehall plans to be “clarified”.
The Department of Energy and Climate Change is putting the finishing touches to a new Renewable Obligation support system but that only runs until 2017.
The announcement has been delayed by behind-the-scenes wrangling with a Treasury that allegedly wants to cut onshore wind subsidies by 25% instead of the 10% reduction originally proposed by the DECC.
More than 100 Conservative backbenchers have turned the issue into an overtly political one by urging David Cameron to slash subsidies to “inefficient” windfarms despite the key role that wind plays in meeting renewable energy and carbon targets.
DECC insisted on Thursday that the only hiccup was finding a slot in the parliamentary timetable and promised a final decision within two weeks.
The threat of court action from the wind sector came from the lobby group Renewable UK, whose policy director, Gordon Edge, said the industry might have a case for judicial review if the cut exceeded 10%.
“It’s really important this process is seen to be evidence-based and rational … The government took technical guidance on this issue. If, at this point, the government says we are going to do less for onshore wind than it proposed that will be seen as nakedly political,” Edge told BBC News. The solar industry has already successfully taken ministers to court as has Greenpeace over nuclear policy.
Siemens has warned that ministers need to provide much more clarity in their renewable energy policies if the German engineering group is to proceed with a £200m plan for wind turbines.
Graham Hartley, managing director of Siemens Energy Services, said the uncertainty had already put wider industry plans in the North Sea between six months and a year behind where they expected to be. “We are still very positive but we need clarity [of government policy] and clearly at the moment that is not the case. This makes a big difference as to whether our customers invest or not,” he said.
Hartley was talking to the Guardian less than two weeks after a rival wind turbine manufacturer, Vestas, pulled the plug on plans to build a factory at Sheerness docks in Kent despite winning planning permission. It blamed lack of orders for the move, although critics noted that Vestas has been suffering its own internal problems.
Earlier this year a third turbine maker, Doosan of South Korea, also scrapped plans to construct a research and development centre in Glasgow, citing “sapping market confidence”.
Siemens said it was not about to pull out but could not employ 50 senior staff on planning for the next round of projects in deep offshore waters indefinitely if it felt orders were not going to materialise.
The company, along with Associated British Ports, won planning permission last month for a scheme that is meant to be ready for 2014 to deliver a new generation of large 6 megawatt blades.
But the issue of subsidy levels has become a political football at a time of government cuts and rising fuel bills, mainly because of controversy around onshore windfarms, where state support of any kind is now vigorously opposed by a sizable group of vociferous Conservative backbenchers.
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