[holding answer 17 July 2012]: DECC does not maintain a record of when wind projects are first connected to the grid. However, DECC's Renewable Energy Planning Database (REPD) does record when wind projects become fully operational. The REPD data showing the number of onshore and offshore wind projects that became fully operational in 2010, 2011 and 2012 is set out as follows.

The following table shows the number and installed capacity in megawatts (MW) of operational wind projects in the UK as at May 2012.

The following table shows (A) the number of onshore and offshore wind projects and (B) the capacity for which applications were submitted in (1) 2007, (2) 2008, (3) 2009, (4) January to May 2010, (5) May to December 2010, (6) 2011 and (7) 2012 to date.

A copy of this information, in respect of onshore wind, will be placed in the Libraries of the House.

I am grateful to my hon. Friend for his answer. Can I take it from the fact that he does not give specific figures that he agrees with the figures in the report by Professor Gordon Hughes, the professor of energy economics at Edinburgh university, “Why Is Wind Power So Expensive?”? The cost of providing a given amount of power by wind plus open-cycle gas turbines is greater than the cost of using efficient combined-cycle gas turbines by a factor of 10. Is that really something that the consumer can afford, if it saves only £500 million a year in operating costs?

What steps are the Government taking to ensure that capital investment in wind monopiles will result in manufacturing taking place in the UK using UK steel, so that UK energy bill payers and UK taxpayers can fund UK jobs?

The joint DECC/RenewableUK report by BiGGAR Economics¹ does not draw conclusions about how much onshore wind might be needed to contribute to the UK's renewable energy target. It sets out four potential deployment scenarios² for 2020 ranging between 10 GW and 19 GW, and considers the impact that each of these would have on UK jobs and investment.

In last year's Renewables Roadmap, the Government set out a central scenario of up to 13 GW onshore wind deployment in our energy mix by 2020, to maintain our energy security, to help meet our 2020 renewable targets.¹ The findings of the report are based on 18 case studies of experience on the ground, and set out the gross impacts of commercial onshore wind development. A copy of the report is at:

http://www.decc.gov.uk/assets/decc/11/meeting-energy-demand/wind/5229-onshore-wind-direct--wider-economic-impacts.pdf² The scenarios were taken from the 2010 National Renewable Energy Action Plan, see:

http://www.decc.gov.uk/assets/decc/what%20we%20do/uk%20energy%20supply/energy%20mix/renewable%20energy/ored/25-nat-ren-energy-action-plan.pdf

and the 2011 UK Renewable Energy Roadmap, see:

http://www.decc.gov.uk/assets/decc/11/meeting-energy-demand/renewable-energy/2167-uk-renewable-energy-roadmap.pdf

The Government has made no payments to wind farms in compensation for non-production.

In order to ensure the secure operation of the electricity system, National Grid takes over a thousand actions each day to balance electricity supply and demand, including paying generators of all types to alter their output. The vast majority of these payments are made to fossil fuel generators, rather than wind farms. National Grid has advised that details of all Balancing Mechanism payments are published at:

www.elexon.co.uk

and

www.bmreports.com

The Renewables Obligation (RO) is currently the Government's main financial incentive for large scale renewable electricity, including wind power. This requires supply companies to source a specified and annually increasing proportion of their electricity sales from eligible sources of renewable energy or pay a penalty. The RO is a generation based subsidy, meaning support is granted for each MWh of electricity actually generated. A wind farm will therefore only receive support when it generates.

The Government's main mechanism for incentivising large-scale renewable electricity is the renewables obligation (RO), which provides support for eligible generation. Wind farm hosts do not receive public subsidies other than support for eligible generation under the RO.

The following table sets out the annual RO spend on onshore and offshore wind for each year from 2002-03 to 2010-11 (the latest year for which data are available). RO bands are currently being reviewed and we expect to announce the outcomes shortly.

In addition, the following table shows UK public energy spend on Research, Development and Demonstration (R,D&D) on wind technology, as reported to the International Energy Agency (IEA).

The spending review of November 2010 announced funding of over £200 million for low-carbon technologies over the next four financial years from April 2011. Of this funding, up to £60 million was included to support the establishment of major offshore wind manufacturing facilities at coastal locations in assisted areas of England and the Department announced up to £30 million for offshore wind technology development.

The evidence of a general fall in property prices caused by the presence of the wind farms is mixed. The Government is nevertheless keen to give host communities a greater stake in local wind farm developments and will be legislating this year to enable local retention of business rates accruing to renewables development over the lifetime of such projects. In addition, many generators have committed to a voluntary contribution to local communities in England of a minimum of £1,000 per megawatt installed capacity per year.

Studies have considered the noise phenomenon known as amplitude modulation (AM), but show that to date

only one wind farm in the UK has presented a noise nuisance to residents. The issue has since been resolved. We will keep the issue of AM under review and welcome the additional research on AM that RenewableUK have commissioned.

The evidence of a general fall in property prices caused by the presence of the wind farms is mixed. The Government is nevertheless keen to give host communities a greater stake in local wind farm developments and will be legislating this year to enable local retention of business rates accruing to renewables development over the lifetime of such projects. In addition, many generators have committed to a voluntary contribution to local communities in England of a minimum of £1,000 per megawatt installed capacity per year.

Studies have considered the noise phenomenon known as amplitude modulation (AM), but show that to date

only one wind farm in the UK has presented a noise nuisance to residents. The issue has since been resolved. We will keep the issue of AM under review and welcome the additional research on AM that RenewableUK have commissioned.

DECC's Renewable Energy Planning Database (REPD)¹ tracks the progress of renewable electricity projects from inception, through planning, construction and operational phases and is updated on a monthly basis. The following tables show the breakdown of wind turbine numbers and capacity for May 2012.

Note:

https://restats.decc.gov.uk/cms/planning-database/

The data is derived from REPD surveys, carried out on a monthly basis, and RESTATS data collection activities carried out primarily on an annual basis with estimates on a quarterly basis. Data sources include the Infrastructure Planning Commission, planning authority websites, developers websites, trade association websites, journals, ad hoc market intelligence sources, DECC and devolved Government websites/contacts (including S36 Consents), Ofgem ROCs database with crosschecking against other data collection activities such as Renewables UK. It should be noted that within REPD the definition of an operational project requires that every turbine must have generated. The definitions used by other organisations may vary.

A number of independent peer reviewed research studies commissioned by DECC and its predecessor Departments have looked at the impacts of noise from wind farms and concluded that there is no evidence of direct health effects arising from infrasound or low frequency noise generated by wind turbines.

The Government reviews new evidence carefully to assess whether these conclusions remain valid. In our assessment the British Medical Journal editorial article of 8 March 2012 on wind turbine noise does not change the conclusion that appropriately sited wind turbines do not have a direct effect on public health.

Onshore, wind farm developers make decommissioning arrangements with the relevant local planning authorities and other parties who have a particular interest, for example, the landowner.

Offshore, the statutory decommissioning scheme for wind farms provides security that their removal can be undertaken by developers.

Both of these regimes provide for the use of bonds if appropriate in the circumstances.

For onshore wind farms, the Secretary of State, or relevant local planning authorities are able to include requirements for decommissioning and restoration of land to an acceptable state condition as part of the planning approval process.

Offshore, there is a statutory decommissioning scheme which allows the Secretary of State to compel wind farm developers to submit costed programmes for the removal of their projects with funds set aside for that purpose.

The minutes of the 8 May 2012 meeting of the Cost Reduction task force will be published by the end of June 2012. There were no minutes for the meeting on the 15 May 2012, as this was not a full meeting of the task force, its purpose was to was to work on the outline structure and drafting of the task force report.

Minutes of the task force meetings can be found via this link:

http://www.decc.gov.uk/en/content/cms/meeting_energy/wind/offshore/owcrtf/meeting_docs/meetingdocs.aspx

The Offshore Wind Cost Reduction task force launched its report on the 13 June 2012, a copy of the report can be found at:

http://www.bwea.com/pdf/publications/Offshore_Task_Force_Report.pdf

The Offshore Wind Cost Reduction task force published its report on the 13 June 2012 at RenewableUK Global Offshore Wind Conference. A copy of the report can be found at:

http://www.bwea.com/pdf/publications/Offshore_Task_Force_Report.pdf

Data are not available on the operational hours of onshore and offshore wind turbines and therefore it is not possible to estimate the time that the turbines were not in operation in the last 12 months. Provisional estimates of load factors for onshore and offshore wind in 2011 are 27.4% and 36.7% respectively.

The Government's main mechanism for incentivising large-scale renewable electricity is the renewables obligation (RO) which provides support for eligible generation. Generators receive renewables obligation certificates (ROCs) for every megawatt hour (MWh) of eligible renewable electricity they generate. Less efficient turbines will therefore receive a lower level of support.

Electricity market despatch modelling suggests that as more wind power comes on to the system, average wholesale prices will decline slightly, due to there being more low short-run marginal cost plant (i.e. wind) on the system. For example, research by Redpoint consultants for DECC in 2009¹ examined a low renewable electricity scenario (reaching around 16% in 2020) and a high scenario (reaching around 29% in 2020). They found that average wholesale prices from 2011 to 2030 were 4% lower in the high renewable scenario than in the low. The average wholesale price that flexible conventional generators receive is likely to be higher than the overall market average as they will run more at periods of higher prices.

The Government is taking powers to introduce a capacity market which will be able to ensure that sufficient capacity is available to meet demand. Conventional generators would receive a relatively stable capacity payment instead of just relying on uncertain and volatile prices from an energy only market. This would help to increase certainty of income for conventional generators.

On 17 March the Secretary of State for Energy and Climate Change, the right hon. Member for Kingston and Surbiton (Mr Davey), and the Chancellor of the Exchequer, my right hon. Friend the Member for Tatton (Mr Osborne), announced plans to publish a new gas generation strategy in the autumn of 2012 to ensure investment in this sector comes forward, alongside the required generation in low carbon technologies. This was confirmed in the Budget on 21 March. The strategy will focus on the role of gas in the electricity market, and its aim is to attract investment in gas generation by overcoming any barriers, ensure energy security, meet the UK's carbon reduction targets, and make the best use of the nation's natural resources.¹ Redpoint, 2009, Implementation of the EU 2020 Renewables Target in the UK Electricity Sector: RO Reform, available at:

http://www.decc.gov.uk/assets/decc/what%20we%20do/uk%20energy%20supply/energy%20mix/renewable%20energy/

renewable%20energy%20strategy/1_20090715120542_e_ @@_redpointimplementationoftheeu2020renewables targetintheukelectricitysectorroreform.pdf

DECC has not carried out an assessment of the proportion of wind energy infrastructure that is manufactured in Britain.

However, over the 2011-12 financial year industry announcements totalled £6.9 billion confirmed and planned investments in the UK renewables sector (including onshore and offshore wind) with the potential to support over 20,800 UK jobs.

The average rate of return required for investment in onshore wind farms, assumed in the analysis for the renewables obligation banding review, is 9,6%. The actual return on investment for individual wind farms will depend on many factors including their specific location, costs, the amount of and price received for the electricity they generate, and the level of subsidy.

Our assumption is based on Arup's report which can be found on our website at:

http://www.decc.gov.uk/assets/decc/11/consultation/ro-banding/3237-cons-ro-banding-arup-report.pdf

and a report by Oxera for the Committee on Climate Change which can be found at:

http://hmccc.s3.amazonaws.com/Renewables%20Review/Oxera%20low%20carbon%20discount%20rates%20180411.pdf