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Subsidy cut to cost ESB windfarm project tens of millions

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File photo dated 20/05/09 of a wind farm in Scotland as removing public subsidies for onshore wind farms would undermine the UK's credibility at crucial UN climate talks, according to Scotland's energy minister. PRESS ASSOCIATION Photo. Issue date: Sunday June 7, 2015. Fergus Ewing has called on UK Energy Secretary Amber Rudd to clarify the Government's plans for reforming the subsidy regime for the sector. The Department of Energy and Climate Change (DECC) is expected to announce

File photo dated 20/05/09 of a wind farm in Scotland as removing public subsidies for onshore wind farms would undermine the UK's credibility at crucial UN climate talks, according to Scotland's energy minister. PRESS ASSOCIATION Photo. Issue date: Sunday June 7, 2015. Fergus Ewing has called on UK Energy Secretary Amber Rudd to clarify the Government's plans for reforming the subsidy regime for the sector. The Department of Energy and Climate Change (DECC) is expected to announce

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File photo dated 20/05/09 of a wind farm in Scotland as removing public subsidies for onshore wind farms would undermine the UK's credibility at crucial UN climate talks, according to Scotland's energy minister. PRESS ASSOCIATION Photo. Issue date: Sunday June 7, 2015. Fergus Ewing has called on UK Energy Secretary Amber Rudd to clarify the Government's plans for reforming the subsidy regime for the sector. The Department of Energy and Climate Change (DECC) is expected to announce

A PROPOSED €840m windfarm portfolio that the ESB is jointly developing in the UK is set to lose out on tens of millions of euro a year in subsidies from the UK government.

The Conservative government announced yesterday that new onshore windfarms will be excluded from the Renewables Obligation (RO) subsidy scheme from April 1, 2016, a year earlier than expected.

Several energy companies may be able to avail of a "grace period" that will allow developments that already have planning permission to still qualify for the lucrative payments.

The ESB recently announced that it is developing £600m (€840m) of onshore wind farms in the UK with Scottish windfarm development company Coriolis Energy.

The portfolio will be made up of nine farms which are expected to have a peak generational capacity of 400 megawatts (MW) per hour.

The majority of projects are to be located in Scotland although the ESB added that "opportunities for new windfarm developments will be pursued throughout the UK". The first project is planned to be operational by 2019.

However, none of the projects have yet secured planning permission and, as it stands, would not be eligible to receive the UK subsidy payments.

Based on the average load factor of 25.74pc for onshore wind farms in the UK, the 400 MW portfolio would stand to lose out on about £35.96m (€50m) in subsidies each year if all of the planned windfarms were producing electricity at a rate of 25.74pc per day for 365 days a year.

The load factor is the actual output of a turbine benchmarked against its theoretical maximum output in a year. The ESB had not responded to multiple requests from the Irish Independent to provide an estimated load factor for its planned joint UK portfolio at the time of publication.

An spokesman for the ESB said yesterday: "We note today's announcement. Our development partnership with Coriolis Energy aims to deliver low cost low carbon generation in the early part of the next decade in order to meet renewable targets for 2030 onwards."

Irish Independent