UK onshore subsidies to end in 2016 - updated

UK: The Renewables Obligation (RO) onshore wind subsidy will be closed in 2016 under plans released by the Department of energy and climate change (Decc).

Decc plans to end close the RO subsidy early

The RO will close to onshore wind projets from 1 April 2016, a year earlier than current plans.

Decc said a grace period will allow some projects in advanced development to proceed. Up to 5.2GW would be eligible under the grace period but it is unlikely that total will be realised. Projects will be eligible if they have planning consent, a grid connection offer and acceptance, as well as evidence of land rights, according to Decc.

The feed-in tariff will continue for small community projects but it is unclear whether onshore wind projects will still be able to bid in the upcoming Contracts for Difference auction, expected in the autumn.

In a written statement to Parliament, energy minister Amber Rudd said: "With regard to CfDs, we have the tools available to implement our manifesto commitments on onshore wind and I will set out how I will do so when announcing plans in relation to further CfD allocations."

The Conservative Party made a manifesto pledge in last month's general election to "halt the spread of onshore wind farms". The party won an unexpected majority in the election, giving it a mandate to carry out its promises. 

Rudd said the UK has "enough subsidised projects in the pipeline to meet renewable energy commitments", which is to produce 15% of energy from renewables. The UK is estimated to need to generate at least 30% of its electricity from renewables to hit the target.

Rudd's statement to Parliament continued: "My department's analysis indicates that, after taking into account an early closure, onshore wind deployment under the RO will be in the region of 11.6GW. In addition to the 0.75GW of onshore wind that has secured a CfD, this puts us above the middle of the range set out in the EMR Delivery Plan, our best estimate of what we would need to meet our 2020 targets. It is therefore appropriate to curtail further deployment of onshore wind, balancing the interests of onshore wind developers with those of the wider public."

A report by the European Commission this week said the UK was fail to meet renewable energy targets. 

RenewableUK chief executive Maria McCaffery accused the government of "slamming the door" on onshore wind: "The government's decision to end prematurely financial support for onshore wind sends a chilling signal not just to the renewable energy industry, but to all investors right across the UK's infrastructure sectors.

"It means this government is quite prepared to pull the rug from under the feet of investors," she added. RenewableUK believes £3 billion (€4.2 billion) could be added to consumers' bills as a result of cutting the subsidy.

The Confederation of British Industry (CBI) said Decc's announcement was a "worrying signal". CBI deputy director-general Katja Hall said: "This is a blow, not just to the industry, and could damage our reputation as a good place to invest in energy infrastructure."

Shadow energy minister, the Labour Party's Caroline Flint, called the announcement a "knee jerk" reaction, which will "undermine confidence across the sector". 

Former Liberal Democrat energy minister Ed Davey, whom Amber Rudd replaced after the election, tweeted: "Anti-wind power Tories will put up electricity bills, cut green jobs and reduce investment."


Much of the UK's onshore wind capacity and pipeline capacity is located in Scotland. The Scottish energy minister Fergus Ewing said the UK government's decision was deeply regrettable and would disproportionately affect Scotland.  

Ewing has also issued a threat of a judicial review into the subsidy closing, saying the decision appears irrational. 


Elsewhere, the communities and local government minister Greg Clark announced changes to planning laws, giving local residents more power on wind project planning applications. 

The legislation means projects can only be approved with the support of people living in the vicinity of a project via a "Local or Neighbourhood Plan". Proposals must "address" any planning concerns in order to achieve backing by local residents before an application can be approved.