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Constraint payments are costing taxpayers more each year

26 Aug 2024

Some fascinating new research by the Renewable Energy Foundation (REF), as reported in the Daily Mail, has revealed that constraint payments – the cash that is paid by taxpayers to wind farm operators to switch off their wind farms when the grid risks being overloaded – is set to reach record levels this year.

According to REF’s new data, wind farm operators in Scotland have been paid over £205 million to turn their turbines off this year already. Across the UK the figure for this year so far comes to £216,124,168 – meaning that the vast majority of that cost is coming from wind farms operating in Scotland.


The REF has also found that constraint payments continue to increase each year, rising from £51.5million in 2014 to a record £278.5million last year. It is believed that this year will set a new annual record.


Constraint payments began in 2010 and occur on wind days when the output from wind turbines (mainly in Scotland) surges to an unmanageable level due to the lack of capacity in the national grid to carry the power to areas of demand, like England. The farms are then allowed to claim compensation for this lost income, with the costs added to consumer bills. 


This means that taxpayers are being charged for energy which has never actually existed.

Recently, in a bid to increase capacity on the energy transmission network, it was announced that there will be a new ‘electric superhighway’ between Scotland and England which will create a multi-billion-pound subsea cable to move energy from Peterhead in Aberdeenshire to Drax in North Yorkshire.


While ground work in Peterhead is already underway, the offshore cable laying is expected to begin in 2028 with the first transmission of electricity due in 2029. The cost is estimated at around £4.3billion – which will also be paid by consumers. And due to the scale, this will only tackle a very small part of the transmission problem.


The UK is wasting a lot of wind power – and this is set to continue. In general, planning approvals for electricity grid upgrades are not keeping up with the rapid growth of wind power development, so increases to constraint payments will no doubt continue to rise.


It seems as though wind generation is a costly process – whether it’s constraint payments or grid expansion. Will a modernised gird network actually reduce costs for consumers, and how long will it actually take?

 

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