Questions about energy that must not be ducked

The key point is whether wind farms are economically viable or make a
contribution to Britain’s energy security

When it comes to wind power, the Government evidently hopes that out of
sight means out of mind. Subsidies for the onshore turbines that many
regard as a blot on the landscape are to be reduced, while those for
offshore wind farms are to rise. With this move, the Coalition may hope to
quell the growing revolt in rural England against what David Cameron
allegedly referred to as “green crap” – in particular the march of turbines
across the countryside.

However, neither the aesthetics of onshore wind power nor its propensity to
inspire Nimbyism in Conservative-held constituencies is really the issue.
Much more important is whether this form of electricity generation is
economically viable or makes a contribution to Britain’s energy security.
These questions must not be ducked, as they might well be if all future
wind developments are at sea.

In fact, the real reason for the transfer of subsidies has less to do with
stopping onshore projects and more to do with preventing the collapse of
the offshore industry. Investors had been panicked by reports that subsidy
levels would fall, undermining confidence in the sector. Ministers even
appeared to be contemplating the possibility of “minimal investment” in
offshore wind during the next decade.

Recently, the Committee on Climate Change warned Ed Davey, the Energy
Secretary, that “required investment is at risk under current proposals”.
Its lobbying appears to have paid off with the announcement of a higher
“strike price” for offshore, balanced by a five per cent cut in subsidies
for onshore wind and solar. Ironically, however, economies of scale will
still make it worthwhile to build large wind farms; it will be small,
community-led schemes that will become unsustainable.

Since the subsidies for offshore wind are significantly higher than for
onshore turbines, it is hard to see how this is a good deal for the
taxpayer, the consumer or for industry. Even though domestic prices have
been pushed up (and are now to be pegged while taxes take the strain) they
are still among the lowest in Europe. By contrast, energy intensive
industries in Britain, such as steel making, pay some of the highest prices
in the EU because, unlike their competitors, they are not exempt from the
green levies.


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