Northern Ireland Pricing Bonus

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A new twist to the pricing structure for renewable energy in Northern Ireland contains a built in bonus for wind plants. Under the latest round of the UK's Non Fossil Fuel Obligation, energy payments for projects in Northern Ireland carry an additional premium (or penalty) depending on the time of year and the time of day the power is being generated.

For example, energy generated on the 60 days of the year when demand on the utility is greatest, between 16:00 and 19:00 hours in a period from the end of November to late February, will attract a premium of £0.09/kWh ($0.13/kWh). During the remainder of the day the extra will be £0.04/kWh. However, these premium payments are offset by reductions which range up to £0.012/kWh ($0.017) on summer nights.

A generator with steady output throughout the period would end up with the bid price, as the extra payments average to zero, but as winter winds in the province are higher than summer winds, there is a bonus for wind farms. The precise level will depend on the wind pattern and wind turbine characteristics, but could result in around 3% extra revenue on a typical site. The arrangement seems to be an approach towards paying the actual value of energy to the utility. It reflects the realities of power pricing, yet remains commendably simple.

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