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United Kingdom

United Kingdom

Community developer scraps 87MW UK projects due to subsidy change

UK: Wind farm developer Community Windpower has decided to drop the development of two UK projects with a total capacity of 87MW, due, it says, to changes in the government's electricity market reforms.

The plans for the Davidstow wind farm
The plans for the Davidstow wind farm

The company said it will not go ahead with plans to build the 48MW Davidstow wind farm in Cornwall, south-west England, and the 39MW Claughton Moor project in Lancashire the north-west, because of cuts to the subsidies paid for wind.

In December the UK government announced that it would cut the strike price paid for power from onshore wind projects. Support for onshore wind was cut by £5/MWh (EUR 6/MWh) to £90/MWh from 2017.

This change was made to enable a rise in the price paid for offshore wind power. The government has also proposed introducing competitive auctions for wind projects.

The company said it would have to shut a regional office in Camelford, Cornwall and write off millions of pounds in investment as a result of dropping the projects.

Rod Wood, managing director of Community Windpower, said: The government has been constantly shifting its position on UK renewables and it is now planning to rush through an auction process, which is likely to crash the price at best, or in the worst case, stop generators selling green energy altogether."

There had been speculation that smaller community projects that were above the 5MW threshold that excludes them from the feed-in tariff scheme would be hit hardest by the changes in subsidies. This is due to the lower margins generally delivered by such projects.

The government's electricity market reform, which was passed into law in December, introduced a contract for difference regime, where suppliers of wind energy would be paid a fixed strike price for the energy they supply irrelevant of the market price for energy.

Community Windpower currently operates projects with a capacity of around 300MW in the UK.

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