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£11m for the wind farm that was not working  

Credit:  By Edward Malnick | The Telegraph | 23 Aug 2014 | www.telegraph.co.uk ~~

A wind farm has been paid £11 million not to produce electricity, The Telegraph can disclose.

An analysis shows that 10 wind farms have each been paid more than £3 million over the past three years to shut down their turbines.

The sums being handed out to renewable energy companies are up to double what they would have received for producing electricity.

The highest payment of £11.1 million was paid over three years to ScottishPower, a Spanish-owned firm, which operates the Whitelee wind farm, around 10 miles from Glasgow.

The disclosures prompted claims that the Government has failed to “rein in” the amounts being demanded by wind farm owners to turn off their turbines to stop the electricity network becoming overloaded.

The money, which is ultimately added to household bills, is being paid to a series of firms, including a handful owned by the Swedish, Norwegian and Danish governments.

National Grid is responsible for managing the flow of electricity and hands producers “constraint payments” to shut down when there is a risk of the grid overloading because too much is being generated.

Each owner asks for a particular sum for each megawatt hour of energy its turbines would have produced had they been switched on, and National Grid chooses whether to accept their assessment.

The industry says the payments cover forgone subsidies, the wear and tear of shutting turbines down and administration costs.

In September 2011 MPs demanded action by Ofgem, the energy regulator, after The Telegraph disclosed that the Norwegian owners of the Crystal Rig wind farm in the Scottish Borders had been paid £1.2 million not to produce electricity for eight and a half hours.

Ofgem said that since then it has brought down the cost of constraint payments, but critics said firms were still making “excessive” profits.

The Renewable Energy Foundation think tank, which compiled the latest figures from official data, warned that the companies had either made “token reductions” to the amounts or “simply ignored” warnings that they should be brought down.

The total payments since 2011 have exceeded £70 million. Many have been made to wind farms in Scotland, where a large proportion of the UK’s turbines have been built and there are “bottlenecks” of energy leaving the area during high winds.

Among the payments was a total of £7.6 million to RWE Innogy, a German-owned firm, for shutting down the Farr wind farm, 10 miles from Inverness, on dozens of occasions. The sum includes £357,353 for shutting down the wind farm over six days this month.

Fred Olsen has received £3.2 million for shutting down its 85-turbine Crystal Rig wind farm over the past three years, including £159,987 earlier this month amid the high winds caused by Hurricane Bertha.

It asked for £114 per megawatt hour of energy the turbines would have produced had they been switched on, which National Grid accepted.

However, the main loss from turning off its turbines was a consumer subsidy amounting to around £50. Therefore, it was still receiving £64 per megawatt hour more than if it had been generating electricity, the foundation said.

Fred Olsen declined to provide a breakdown of the costs involved in shutting down the wind farm.

Dr Lee Moroney, research director of REF, said: “It is now becoming crystal clear that the full cost of constraints is disturbingly high. A more robust position from both government and the regulator, Ofgem, would go a long way to reining in wind power’s very high constraint prices.”

Wind farm owners insisted that the number of times wind farms were paid to shut down was “very small” compared with the number of times conventional power stations were paid to reduce their output.

Zoltan Zavody, from RenewableUK, the industry body, said that last year the total cost of wind constraint payments was around 65p on the average annual domestic electricity bill.

Ofgem said that since it was given powers in 2012 to prevent firms getting an “excessive benefit” from the payments, the prices paid have fallen from an average of £197 per MWh to £83 per MWh.

A spokesman for National Grid said: “For the moment, constraint payments are the most economically efficient way to balance the system while we await improvements to the electricity network such as the Western Link – a £1  billion sub-sea link that will bring renewable energy from Scotland to the rest of the UK.”

Source:  By Edward Malnick | The Telegraph | 23 Aug 2014 | www.telegraph.co.uk

This article is the work of the source indicated. Any opinions expressed in it are not necessarily those of National Wind Watch.

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