Calls for UK to review onshore subsidy removal

UK: A group of MPs has called on the government to readdress its decision to end subsidies for onshore wind in the UK, and to reconsider if onshore wind could be included in future subsidy auctions.

Scotland has approximately 60% of the UK's installed onshore wind capacity

The report by the Scottish Affairs Committee, which examines the relationship between central UK government and the devolved Scottish government, said Scottish views were not fully considered when the decision to close the previous Renewables Obligation support scheme was closed a year early, and when onshore wind was stopped from taking part in future Contract for Difference (CfD) auctions.

The committee said the change in policy and subsidy frameworks will have a "disproportionate" affect on Scotland where over 5.3GW of onshore wind has been installed, approximately 60% of the UK's total. Scotland also provides approximately 30% of the UK's renewable electricity.

"The fact that the cuts fall particularly heavily on onshore wind, where the majority of capacity is deployed in Scotland, means that these changes will have a disproportionate impact on the prospects of Scotland's renewable sector," the report said.

"Scottish Renewables [trade body] told us that early closure of the Renewables Obligation to onshore wind will cost Scotland up to £3 billion (€3.6 billion) in lost investment and put 5,400 jobs at risk.

"It is of serious concern that the UK Government implemented these changes without assessing the impact they would have on Scotland."

The committee criticised the government's decision to bar onshore wind from the next round of CfD auctions – expected by the end of 2016 – as it was at odds with its commitment to keeping down costs of supporting renewable electricity.

Details on the expected forthcoming auctions are still missing, which the committee said is "essential" the government address: "This should include the dates of the auction, eligible technologies and strike prices. The Government should indicate the timing of the remaining auctions due to take place this Parliament, ahead of providing more detailed information regarding funding levels and which technologies will be eligible for contracts.

A "market stabilisation" mechanism was also suggested by the committee to guarantee fixed prices for onshore wind at a "subsidy-free" level – an idea the last government was said to be considering. "Subsidy-free" subsidies would be set at the same level of support for traditional electricity sources so effectively not costing the government any more.

Committee chairman Pete Wishart said the recently reorganised government under the new prime minister is cause for greater concerns. "Our report was produced before recent changes to the structure of government — the abolition of the Department of Energy and Climate Change, with its responsibilities moving to a new Department for Business, Energy and Industrial Strategy — but this change indicates a troubling shift in the Government's priorities. I hope that the Government's response to our report will go some way to allaying these fears."