Incentive changes for Wind Turbines

For over 4 years the Northern Ireland farming sector has been benefiting from a highly incentivised wind industry. Many farmers have diversified into the highly lucrative wind business, making money while the opportunity is there by either renting land for turbines or putting up turbines on their land; however there has always been concern about when the government would pull the plug on the industry. When would the ROC payments be cut or second hand turbines be ineligible for incentives.

As of Thursday 3rd July the answer to some of these questions are a little clearer. The Department of Enterprise Trade and Investment have released their long waited consultation paper; ‘Proposed Changes to the Northern Ireland Renewables Obligation – Small Scale Banding Review’. While this is only a consultation paper and the final decision will not be taken until 2015 it gives early warning to what the DETI are considering and it looks very good for the Northern Ireland wind industry.

The paper suggests that the ROC incentives shouldn’t change from their current 4 ROCs and this level of incentive is expected to continue until 2017. “DETI …proposes to retain the level of 4 ROCs/MWh for generating stations with a maximum installed capacity up to 250kW and 1 ROC/MWh for generating stations with a maximum installed capacity >250kW – 5MW.”

This gives any farmer that is interested in getting involved in the wind sector clear guidance about the future of the incentives and means that they have a small window to get their projects started. With regard second hand refurbished turbines the paper suggests that again their will be no change in the current policy of granting full ROC payments for these turbines.”…the review also considered if alternative support levels should be provided to refurbished turbines as the capital costs are likely to be less than for new plant. However, the study concluded that there was no evidence to suggest that a separate band was necessary and that the complexity of introducing a change could not be justified…we are therefore not proposing any change to the existing policy which allows refurbished turbines to receive the same level of support as new turbines.”

The above statements from DETI should comfort all those in the wind industry. It has long been accepted by that industry that a 250kw turbine will average approximately £100,000.00 a year; however, there are two 250kw turbines in Northern Ireland which all farmers should be aware of. EWT, a Netherlands based wind turbine manufacturer, have two 250kw rated turbines spinning in Northern Ireland that are producing more than £250,000.00 each year, these are not on particularly windy sites but are much larger turbines with a greater swept area to capture the wind. While these turbines can only be bought new with this kind of return they pay for themselves within 4 years!

If you have any questions or would like any advice, you can get in touch here.