Scottish Wind Farm Accused of Using Net Zero Loophole to Make £647 Million

Source:

https://www.theepochtimes.com/world/scottish-wind-farm-accused-of-using-net-zero-loophole-to-make-647-million-5497857

Think tank alleges that consumers have overpaid hundreds of millions of pounds for wind energy through legal means.

Consumers have overpaid by millions of pounds for energy from Moray East wind farm in northeast Scotland via a legal net zero loophole, according to the Renewable Energy Foundation (REF).

REF, which is critical of wind farm expansion, has alleged that the wind farm took advantage of the loophole as well as a scheme where it gets paid when not making electricity.

On its website the Moray Offshore Windfarm (East), known as Moray East and comprising 100 9.5 megawatt (MW) turbines located off the northeast coast of Scotland, describes itself as a “highly competitive offshore wind project."

It is joint owned Diamond Green Limited, CTG, and Ocean Winds. The site was at one point Scotland’s largest operational wind farm.

Critics say that while the farm has "acted entirely legally," the loophole shows that the "myth of cheap wind energy has been gradually unravelling."

'Very Very Profitable'

REF said that the wind farm is "notable for its extremely high levels of income, over £1 billion since it began generating in June 2021 and up to July 2023," and that it has two "very very profitable source of incomes."

It said that it had "with a strikingly high average of £234 per megawatt hour generated, well in excess of the average price of £168/MWh, received by gas-fired generators in the same period."

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It said that this was down to Contract for Difference (CfD) contracts and constraint payments.

REF said that Moray East wind farm got a CfD contract in 2012, meaning they would receive a certain amount of money for their electricity, and that amount wouldn't change no matter what happened in the electricity market.

Prime Minister Boris Johnson onboard the Esvagt Alba during a visit to the Moray Offshore Wind Farm East, off the Aberdeenshire coast, during his visit to Scotland on Aug. 5, 2021. (Jane Barlow - WPA Pool/Getty Images)

However, it said that Moray East has not implemented its CfD, preferring to take "the much higher market prices prevailing in the wake of the invasion of Ukraine."

As a result of this, Moray East received £812 million in electricity sales since coming online in summer 2021.

It also noted the wind farm has received constraint payments for cutting its output at times when its electricity cannot be used locally or transmitted to other areas of the country because of grid congestion.

This, it claims, means that Moray East earned more per MWh when not generating electricity than when generating and selling normally.

'Multitude and Complexity'

"The UK’s approach to renewables has resulted in unjustifiably high costs to consumers, but the multitude and complexity of the revenue streams available to generators has concealed this fact. There are two issues that government needs to address immediately," wrote REF.

Harry Wilkinson, head of policy from the think tank Net Zero Watch, told The Epoch Times by email, “The myth of cheap wind energy has been gradually unravelling, but the sorry story of the Moray East wind farm has put the nail in the coffin."

"Rather than provide cheap clean energy as had been promised, the operators have exploited an energy crisis to rake in hundreds of millions of pounds from ordinary Britons," he said.

"What has been most egregious, however, is the way in which civil servants have allowed this to happen. A loophole in green energy contracts has meant the wind farm has acted entirely legally—this could quite easily have been avoided,” he added.

'Not in the Spirit of the Scheme'

The UK government claims that electricity systems around the world use the constraint payment model.

A Department for Energy Security and Net Zero spokeswoman told The Epoch Times by email that the "vast majority of Contracts for Difference projects paid back into the scheme when energy prices were at their highest last year—helping keep energy bills lower for consumers."

“It is not in the spirit of the scheme for generators to delay their start date to increase revenue. We have made changes to the scheme to ensure this is not possible for projects from Round 5 and beyond," she said.

“As well as investing billions in new energy projects, we will also upgrade our grid infrastructure to bring that power to households and businesses,” she added.

A spokesman for Ocean Winds told The Telegraph, “Moray East remains on course to start its CfD within the contractual terms set by the process and has always acted in accordance with this agreement.”

The Epoch Times has contacted Ocean Winds for further comment.