Finland

Finland

Merchant sites show onshore potential if governments listen

Two turbine orders in early September for subsidy-free sites indicate that onshore wind is on the brink of a subsidy-free existence with the emergence of super-sized rotors. But state intervention is still needed.

Subsidy-free… Nordex will supply its N133/4.8 turbines to the Crossdykes project in Scotland
Subsidy-free… Nordex will supply its N133/4.8 turbines to the Crossdykes project in Scotland

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Vestas secured a deal with developer OX2 to provide turbines to two 30MW merchant projects in west Finland, while Nordex signed a supply deal for Muirhall Energy’s 46MW Crossdykes project in Scotland.

Subsidy-free and merchant projects are popping up more regularly across Europe, particularly in Scandiavia, thanks to the latest generation of 4-5MW turbines with 140-160-metre rotors.

The falling prices in some other markets would suggest these projects will become more common as we enter the next decade.

Leading the way

However, the industry is still calling for national governments to play a continued role in supporting new capacity, even in markets where subsidy-free projects are already operating.

These days state intervention is needed, not to continue offering subsidies, but to maintain stability — in both political and economic terms — to reassure investors, as WindEurope chief Giles Dickson told Windpower Monthly earlier this year.

The UK is one of the markets where this drum is being beaten loudly.

According to trade body RenewableUK, there are currently six onshore wind farms in the country either near or under construction totalling 203MW, including the Crossdykes project.

These subsidy-free sites demonstrate what we already know: onshore wind is competitive in the UK. But projects are only viable in some areas, and only with the latest technology.

In order to continue growing onshore wind, and reach carbon-emission reduction targets, more capacity needs to be added.

In the UK, this is mainly done through the contracts for difference (CfD) auction system, which sets a guaranteed price for their energy generation.

Since 2017, onshore-wind projects have been barred from the auction rounds, all but killing off growth in the sector. The right-wing Conservative government said at the time it wanted to limit renewables’ impact on household bills.

But, with onshore wind now demonstrably able to compete in the market, the option of subsidy-free CfDs — at no extra cost to the consumer — has been resurrected.

By accessing a CfD, developers can secure a stable revenue outlook, something investors like to see.

"It’s exciting to see work getting under way on what will be one of the UK’s first subsidy-free onshore wind farms, with all the economic benefits that it brings to local construction companies as well as consumers," Rebecca Williams, RenewableUK’s head of policy and regulation, said about the Nordex deal.

"Several other such projects are in the pipeline, but we need more volume if we’re to maximise the benefits of the UK’s cheapest power source and reach net-zero emissions at the lowest cost.

"We need to see the government positively support the wider deployment of onshore wind. Top of the list is allowing new projects to compete for government-backed contracts," she added.

Nigel Hayes, managing director for UK and Ireland at Nordex, said: "It is exciting to see merchant wind opportunities being realised in the UK market.

"Although this is welcome, and this segment of the market will hopefully continue to grow, in order for onshore wind to really realise its potential in the UK — and play a major part in the drive towards a zero-carbon system, it is important that a support mechanism is re-established."

Height limitations

Crossdykes demonstrates a second area where the UK is missing out.

For decades, an unofficial permitting limitation of a 125-metre tip height has been in place. In recent years, this has meant developers could not use the latest technology.

However, Muirhall Energy had its application approved for taller turbines, making the new generation of machines an option.

"A number of the planning [permitting] committee members saw [an] obvious benefit in us deploying fewer, larger turbines when we were granted a variation to our consent to allow us to increase tip heights in June of this year," a spokesman for Muirhall said.

The tip height for the Nordex N133/4.8 turbines will be 176.5-metres, some 50 metres taller than is usually acceptable in the UK permitting process.

The industry must be hoping this trend will extend to other regions of the UK to help usher in the subsidy-free era faster.

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