From 2013, onshore wind projects will receive 0.9 Renewable Obligation Certificates (ROCs) per megawatt hour, instead of the 1 ROC/MWh they currently receive.
The cuts will affect offshore wind later, with the number of ROCs falling from two to 1.9 in 2015/16 and 1.8 in 2016/17. Originally, the reduction was supposed to take effect in 2014.
Trade body Renewable UK said that the cuts would mean a reduction in onshore wind deployment by 2017 from 12GW to 10.4GW, though this would mainly affect small-scale community projects.
It is concerned that the cuts to offshore will force manufacturers planning factories in the UK to reconsider.
The cuts are part of a review of the financial support given to all renewable technologies, announced today.
Energy minister Chris Huhne said: "We have studied how much subsidy different technologies need. Where new technologies desperately need help to reach the market, such as wave and tidal, we’re increasing support. But where market costs have come down or will come down, we’re reducing the subsidy."