Renewable Energy Foundation

WEBINAR - 4th November 2020 at 11.00 am

The Renewable Energy Foundation would like to announce the publication of a major new study:

Wind Power Economics: Rhetoric and Reality

written by Professor Gordon Hughes of the School of Economics at the University of Edinburgh. This study, which will be published on November 4th 2020, uses a unique database on the actual costs of building and operating more than 350 wind farms in the UK. In addition, it provides a detailed analysis of the performance of more than 9,500 wind turbines in Denmark focusing on their cumulative output and reliability.

The study can be obtained from the Renewable Energy Foundation website from midday on November 4th 2020.

To accompany the release of the study, the Renewable Energy Foundation will host a Webinar on November 4th 2020 at 11.00 am at which Professor Gordon Hughes will be the main speaker. He will present the main findings of his study and answer questions on his work.

There is no charge for joining the webinar but please note that the number of participants is limited to 100. To obtain the details of how to join the webinar please email  This e-mail address is being protected from spambots. You need JavaScript enabled to view it .

The Sunday Telegraph has today reported on REF’s forthcoming major new analysis by Professor Gordon Hughes, under the title Wind Power Economics: Rhetoric and Reality.

The study contains two volumes, one on the Performance of Wind Power in Denmark and the other on Wind Power Costs in the United Kingdom.

On the basis of a large and detailed statistical analysis of audited accounts and other performance data Professor Hughes shows that far from falling dramatically, capital costs for wind power have come down only slightly, and that Operation and Maintenance (O&M) costs required to maintain energy yields are actually rising sharply, throwing the medium and longer term economics of the entire enterprise into jeopardy.

The study will be published shortly with a webinar, and anyone interested in being added to the mailing list for that announcement should write to us at REF at This e-mail address is being protected from spambots. You need JavaScript enabled to view it

REF will shortly publish major new analysis by Professor Gordon Hughes, under the title Wind Power Economics: Rhetoric and Reality.

The study contains two volumes, one on the Performance of Wind Power in Denmark and the other on Wind Power Costs in the United Kingdom.

On the basis of a large and detailed statistical analysis of audited accounts and other performance data Professor Hughes shows that far from falling dramatically, capital costs for wind power have come down only slightly, and that Operation and Maintenance (O&M) costs required to maintain energy yields are actually rising sharply, throwing the medium and longer term economics of the entire enterprise into jeopardy.

The study will be published shortly with a webinar, and anyone interested in being added to the mailing list for that announcement should write to us at REF at This e-mail address is being protected from spambots. You need JavaScript enabled to view it

In the course of preparing this work and discussing it widely with colleagues we have become aware that the findings are surprising to many, particularly to some industry players who enjoy special circumstances unrepresentative of the overall wind sector.

An example of these special circumstances may make the point clear. Northern Ireland has several hundred small (< 250 kW) and apparently old turbines that are still making money. Some might say, and indeed REF has heard it said, that the empirical experience of these wind turbine operators should count for more than statistics, even if the statistical analysis is based on real cost data from audited accounts and authoritative records of real generation such as that behind Professor Hughes’s study.

While speciously persuasive this proves to be a good example of how dangerous it is to rely on limited, personal or anecdotal information when forming a general view. Uncle Wilfred may indeed have lived to a hundred on a diet of cigars and whiskey, but that is no recommendation for the rest of us. By the same token, closer examination of the situation in Northern Ireland shows it is no guide to the rest of the sector.

A series of unwelcome records were broken over the Bank Holiday weekend period, from Friday the 22nd to Sunday the 24th of May, 2020.

(i) Constraint payments made to wind power to reduce output within the Balancing Mechanism were £9.3 million - the highest ever paid for any three-day period (Sunday Telegraph “Wind Farms Paid Record £9.3m to Switch off their Turbines”).
(ii) System electricity prices dropped below zero for long periods with a record average price of -£17 per MWh being recorded on the 22nd.
(iii) Intermittent day-ahead prices used to calculate CfD subsidies averaged -£10 per MWh on the 23rd, the first time the average for an entire day has been negative.

The cost to the consumer of balancing electricity over this chaotic weekend is in excess of £50 million (The Times “National Grid pays out £50 million to turn power down as lockdown hits demand” .

There have been no constraint payments to Scottish wind power in the UK’s Balancing Mechanism (BM) since the 21st of April and up to the date of writing (7th of May). This is welcome after a very expensive start to the year when consumers paid £95 million to discard Scottish wind output from the 1st of January to the 21st of April..

But the reduction in constraints is not the result of improved balancing techniques or the return to service of the hitherto troubled Western Link interconnector. Rather, it is the result of low wind generation in Scotland reducing congestion within the country and over the links to England. Consequently exports to England have been declining for some weeks.

The figure below graphs average daily transfers of electricity (MW) across the Anglo-Scottish interconnectors, as reported by National Grid and archived by REF.

Figure 1: Average daily electricity transfers (MW) across the Anglo-Scottish interconnectors in 2020 to date (blue line), with a running seven day average of the averages (red line). Gaps in the chart occur when a complete set of daily data was not available or obtained. Source: Chart by REF: Data from National Grid.

UK wind output was high in the months of January (6.3 TWh) and February (6.9 TWh), fell back in March (5.6 TWh), and slumped in April, when it generated only 3.4 TWh. So far, wind output in May is also low. Indeed, Scotland is now frequently importing electricity, even at this time of extremely low load in the GB system.

The cost of excess wind power in the first two months of 2020 amounted to £72 million in payments to wind farms to reduce output, mostly (£69 million) in Scotland. Last year’s annual total of £139 million was a record, but does not seem likely to remain so for long.

Comparing payments in January and February for all years back to 2012 we find that the total for those months in 2020 is nearly four times that in the next most expensive year, as shown in the following chart.

When there is a collision between different government policies with the same purpose the result is sure to be messy, and the chances are that the benefits arising from both policies will be compromised and perhaps lost altogether. The Scottish Government, for example, aims to reduce carbon dioxide emissions through the enhancement of carbon sinks, such as forestry and peat, while also encouraging the generation of electricity from industrial wind power. Since both projects are land hungry and the United Kingdom’s geographical area is finite or even diminishing, it is highly unlikely that targets for forestry and peatlands, on the one hand, and renewables on the other can be simultaneously approximated, let alone met and maximised.

Last weekend the Italian cable manufacturing company, Prysmian, released a statement announcing to the markets that the Western Link High Voltage Direct Current (HVDC) interconnector between Hunterston and Deeside had failed again, on the 10th of January. This grid link, which is a joint venture between Scottish Power Transmission (SPT) and National Grid (NG), employs cables manufactured by Prysmian.

This £1 billion project has a peak transit capacity of 2.25 GW and was designed solely to facilitate the export of Scottish wind power to the English and Welsh markets. In doing so it was expected to reduce constraint payments to wind power, payments which amount to £630m since 2010, with a record £130 million in 2019 alone.

The project was expected to come online at the end of 2015 but in fact did not become fully operational until late 2018 and has been plagued with faults ever since.

2019 was the tenth year in which British wind farms have received constraint payments to reduce their output because of electricity grid congestion. There has been a total of £649 million paid out over the decade for discarding 8.7 TWh of electricity. To put this in context, this quantity of energy would be sufficient to provide 90% of all Scottish households with electricity for a year.

Because of a rapid growth in wind farms, particularly in Scotland, the total paid has tended to increase year on year in spite of grid reinforcements and new grid lines such as the £1 billion Western Link from Hunterston to Deeside, which was built specifically to export wind power from Scotland to English and Welsh consumers. Figure 1. displays this trend, showing payments rising from £174,000 in 2010 to a new record cost of more than £139 million. The quantity of electricity discarded in 2019 was also a new record at 1.9 TWh.

The Scottish Government has recently approved increases in turbine heights – now set to reach 150 metres (490 feet) to blade tip – at the extension to the Gordonbush wind farm in the far north of Scotland, near Brora in Sutherland. The approval brings many significant public interest questions into the spotlight.

Golden Plover image : Stuart Anthony 

The Gordonbush wind farm is notorious for its impact on wildife in the area, particularly Golden Plover. A study by the RSPB found that 

"numbers of the plover, which are protected under the European Birds Directive, dropped by 80 per cent within the wind farm during the first two years of operation, with these declines being markedly greater than on areas surrounding the wind farm that were studied over the same period."

The existing Gordonbush wind farm lies behind a grid bottleneck and has consequently been paid over £16.4 million to reduce output since it was commissioned in 2012. The 227.5 GWh of electrical energy discarded over that period is roughly equivalent to the annual consumption of over 50,000 Scottish households. (Wind farm constraint data is available on the Renewable Energy Foundation charity's website.)

Typically, and Gordonbush is no exception, a wind farm makes more per unit of electricity constrained off the network than when selling normally to consumers. In the specific case of Gordonbush, when constrained off, the RO subsidy forgone is about £50 per MWh whereas the site owners charge over £70 per MWh for reducing output when constraints exist.

The volume of energy lost through constraints is in total significant, and in some periods can be very substantial as the following chart shows. In March 2014 a striking 49% of output was constrained off at a cost to the consumer of more than a million pounds. The annual constraints for Gordonbush peaked at 22% of potential output in 2015, and have been at 15–16% for the last two years.

It is important to note that the new £1 billion Western Link interconnector from Scotland to England which was built specifically to improve exports of Scottish wind power has not prevented nearly 20% of Gordonbush’s potential output being constrained off in September and October of 2019. It is not clear that the Western Link interconnector, and its implied standing charge on the consumer, estimated about approximately £50 million a year, is good value for money.

Figure: Generated and constrained off energy by month for Gordonbush wind farm to October 2019

It seems that locating a wind farm at Gordonbush was not clearly in either the public or the environmental interest. The decision to extend and now permit still larger turbines will be very puzzling to many observers.

It is of course advantageous for the wind farm's owners.  The addition of extra turbines to sites of this kind is clearly attractive for wind farm shareholders, and there are many such proposals in the offing around Scotland. However, the planning merits of these applications are dubious at best. Nevertheless, Gordonbush extension was consented, as was the application to vary that consent and install larger turbines.

There is clearly a pressing need for a transparent public debate about further expansion of wind power in Scotland. Since 2010, and at a cost of nearly £600 million, some 8.2 TWh of Scottish wind energy has been discarded, a quantity equivalent to the annual consumption of about 2 million households. The total in 2019 so far is 1.6 TWh at a cost of £113 million. A record year seems likely, in spite of the presence of the new Western Link interconnector to England, which was meant to alleviate these costs.

One has to ask whether it is really on balance beneficial to add more wind farms in Scotland when the system cannot accommodate at reasonable cost the output of those already built.