For the first time ever wind farm subsidies are expected to reach one billion pounds, an all time high. This news precedes a decision that has long been awaited in regards to the amount of money that the energy companies that benefit from these funds would receive.
Government officials were recently held up in making their decision as to the scale of the cuts. The Energy and Climate Change Secretary, Edward Davey, is expected to make an announcement by no later than Tuesday that will settle the matter for the foreseeable future. However, there are many observers who fear that there may be a delay in the announcement due to further discussion.
The original government plan entailed cutting subsidies for onshore wind farms by ten percent which was backed by most Liberal Democrats, meanwhile Conservatives have been for even further cuts that would constitute a quarter of all government subsidies. Depending on the outcome of the size on the cuts that wind farmers will receive there are estimates that indicate that the companies who benefit from the subsidies will make away very nicely, hauling in about £100 billion in subsidies by the year 2030.
The biggest winners among the wind farmers, however, are foreign companies based in countries such as Germany and Norway, with the company benefiting the most being a Danish one. Dong Energy is expected to pull in as much as £156 million from government subsidies as well as what they are already paid for the energy that they sell to the country; all this projected to be within the next twelve months.
As should be expected, the subsidy cuts have caused anxiety among onshore wind farming companies and this has begun to have an impact on investors who would be backing onshore wind farm ventures.