DRASTIC cuts to the public funding of onshore wind-farms, which, it is feared, could hit Scotland's economy by as much as £3 billion and jeopardise hundreds of jobs, are expected to be announced as early as today, according to sources within the renewables industry.
The Commons announcement has been expected for some time following the promise in the Conservative election manifesto to "end any new public subsidy" for onshore wind-farms, which the party believes many people feel are a blight on local communities.
Sources within the industry made clear that "it is the talk of the industry" that the announcement from Amber Rudd, the Energy Secretary, to end the Renewables Obligation subsidy scheme - funded through green levies on consumers' bills - is imminent. It would result in thousands of new turbines not being built.
At the weekend, the Scottish Conservatives said subsidies for new onshore wind-farms should be scrapped as rural areas had "had enough". They claimed the SNP Government's target of generating 16 gigawatts of energy by 2020 from wind-farms had, the latest figures showed, already been "effectively surpassed".
Speaking to the Scottish Parliament's Economy Energy and Tourism Committee, Fergus Ewing, Scotland's Energy Minister, urged Whitehall not to go ahead with ending support for onshore wind power, emphasising its negative impact on consumers, communities and businesses.
With Scotland, having two-thirds of the UK's onshore wind, the fear is that it will be hit disproportionately hard by the removal of public subsidy.
Mr Ewing said: "In 2013, only two years ago, there was a UK Government review of the appropriate level of support for onshore wind and concluded a reduction in support. Those were the rules set by the UK Government and which investment decisions were made on. If you now bring forward an early closure of the Renewables Obligation a huge amount of sunk investment will not go ahead.
"We don't believe an early closure of the Renewables Obligation is a sensible decision and will expose the UK Government and hence the taxpayer to the risk of judicial review. However, if such a decision goes ahead, it must be ameliorated by a grace period covering all projects currently in planning," he added, pointing out analysis by Scottish Power, which estimated the additional costs to consumers of the removal of subsidy to be between £2bn and £3bn.
Niall Stuart, Chief Executive of Scottish Renewables, said: "Cutting support for onshore wind would be bad for jobs, bad for investment and would only hinder Scotland and the UK's efforts to meet binding climate change targets.
"A recent report by the Department for Business, Innovation and Skills estimated there to be 5400 jobs in the onshore wind sector in Scotland. Many of these jobs would be put at risk if support for onshore wind is cut."
He added: "There are currently £3bn-worth of onshore wind projects in the pipeline in Scotland so a sudden closing of the Renewables Obligation would do incredible damage to investor confidence, not just in the onshore wind industry but in the wider UK energy sector as well."
A spokesman for the Department of Energy and Climate Change said: "We've said that there will be no more new subsidies for onshore wind-farms and will shortly be publishing our plans to reform the Renewables Obligation and Feed in Tariff scheme to implement this commitment."
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