Wind farms: millionaire playgrounds for Green fat cats

ENERGY policy in Great Britain has been a shambles for years. Cowardly governments have turned a blind eye to repeated warnings over prices and supply.

The background-running of power stations adds to the cost of wind-farmed electricity. Figures from the Royal Academy of Engineering show that the cost of a kilowatt hour of electricity from an onshore wind turbine, including the cost of stand-by generation, was 5.4p. The corresponding figure for an offshore turbine is a daunting 7.2p. By contrast, gas, nuclear and coal-fuelled power stations could produce the same quantity of electricity for 2.2p, 2.3p and 2.5p respectively.

But instead of pricing the wind turbine operators out of the market, their higher costs are working in their favour, in typical “economics of the madhouse” fashion. The reason is the government’s “Renewables Obligation” handout scheme, by which energy suppliers are – in effect – forced to buy a certain percentage of their electricity from wind turbine owners. Currently, electricity suppliers must purchase some 7.9% of their electricity from renewable sources, rising to 15.4% by 2015.

In a remarkable but largely ignored development, the subsidy paid to renewable power generators through electricity bills is set to surge from £600m a year to £3bn a year by 2020 (this, needless to say, doesn’t appear on anybody’s electricity bills). The owners of existing wind farms are already making a fortune. According to astonishing figures from Ofgem, they could be making more than £100 per megawatt hour; the bigger energy companies are already pocketing up to £90m a year each. But the bonanza is just beginning.

Wind farms are fast becoming millionaires’ playgrounds. Indeed, wind power is the perfect business investment: it adds a splash of green to any bulging portfolio, ticks the “corporate responsibility” box and rakes in bulging fiscal rewards as surely as any hedge fund or coffee franchise.