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The Rt Hon Claire Perry MP Minister of State
Department of Business, Energy and Industrial Strategy
1 Victoria Street London
5th December 2017
Dear Minister of State,
We strongly welcome your recent comments to the Beis select committee indicating government support for onshore wind. We are writing today to ask that you make a public commitment in the upcoming Spring Statement to bring forward an auction for onshore wind, so that it can be built across the UK.
Onshore wind is the cheapest form of new electricity generation that can be built in the UK. This means it is a crucial part of bringing down the cost of energy bills, while also decarbonising our energy system and meeting carbon budget targets.
The government’s support for offshore wind has seen the cost more than halve over the last two years - with two projects delivering at £57.50 per megawatt hour (MWh) in the recent Contracts for Difference (CfD) auction. If the government were to offer similar support to onshore wind, new low carbon power would be even cheaper. A recent auction for onshore wind in Germany set a strike price of just £33.00, which is lower than the UK wholesale price for electricity. These figures compare to Hinkley at £92.50 and new gas at around £66.00 per MWh.
Onshore wind is also hugely popular across the UK, with public support now at an all-time high of 74%. A recent 10:10 commissioned YouGov poll found that 65% of the public would be happy to live within five miles of a wind project, rising to 69% when the project is community-owned. This support is consistent across voting intention, with 57% of Conservative voters happy to live near an onshore wind project, rising to 63% for a community-owned project. Contrary to common assumptions, the polling also shows that onshore wind projects are more popular in England than in Scotland, with 70% of people in the south of England (excluding London) happy to live within five miles of wind turbines.
Given its ambition of achieving the lowest energy bills in Europe, we are concerned that the government is missing a huge opportunity by preventing new onshore wind in the UK - the windiest country in Europe. It is also stymying a technology that enjoys overwhelming public support.
We have been greatly encouraged by the Minister’s comments on this issue since coming into office. We now ask that the Minister commits to building new onshore wind projects in the Spring Statement.
Director of strategy
10:10 climate action
Please add your name and join us in calling on the minister to bring back onshore wind.
Would you be surprised if I told you that 65% of the UK public would be happy to live near a wind farm?
But only 21% would be happy living near a fracking site.
Yet the government’s policy couldn’t be more different. They’ve all but banned onshore wind turbines because they say people are ‘fed up’ with them. Check out the full write up of our polling in Conservative Home and the Guardian.
We believe communities should choose what kind of power generation they host in their local area, that's why we're campaigning to unblock onshore wind.
Thanks for taking part in our poll - now ask your friends to have their say too.
Do you agree that in incorporating the Written Ministerial Statement on wind energy development into paragraph 98 of the National Planning Policy Framework, no transition period should be included?
For live wind energy applications that entered the planning system before the written ministerial statement came into effect on 18th June 2015 we believe transitional arrangements should remain in place to allow determination under the arrangements that applied at that time.
We would also like to make some additional observations about the stated intention versus the actual effects of the written ministerial statement (WMS) in general, alongside some recommendations for bringing outcomes of this policy closer in line with its objectives.
We strongly welcome the intention to provide clarity on the local community ‘backing’ condition, which is discussed in more detail below.
Onshore wind in England post-WMS
The WMS has had a damaging impact on four important stakeholder groups beyond the utility-scale wind energy developers that were ostensibly the target of the new rules; farmers, industrial or large energy consumers, community energy groups and UK-based supply chain companies.
The WMS was billed as “giving local people the final say over wind farms”, and the former Secretary of State for Energy and Climate Change made clear “that where local communities want more onshore wind, that should be supported.” But in practice the two new planning conditions for onshore wind introduced in the WMS, taken together, comprise a de facto moratorium on any new onshore wind generation in England - whether or not the local community wants it.
The Public Renewable Energy Planning Database shows that only six viable planning applications for wind projects in England have been submitted since the WMS was introduced, one of which has already been rejected. The remaining five applications comprise 22 turbines with a combined capacity of 42MW. None are community led schemes.
Farming businesses are being denied the ability to diversify income and reduce business energy costs.
Farmers have been amongst the key beneficiaries of small and medium scale wind energy developments in England and Wales, with renewable energy generation representing a vital source of revenue diversification. Around 500MW of medium sized wind is in private hands, providing gross income of around £125m annually to farming businesses (NFU estimate) - as well as cutting farming business costs. Post-Brexit, farmers will need reliable sources of income and protection from energy price volatility more than ever. However, the most recent NFU Farmer Confidence Survey (autumn 2016) shows that while many forms of on-farm renewable energy continues to grow, the proportion of farmers deploying wind power has remained flat.
Industrial energy consumers
Industrial and large energy consumers are less able to reduce energy costs, reduce exposure to volatility and decarbonise.
Onshore wind is currently the renewable energy generating technology most able to compete with conventional high carbon energy sources in an open market without public subsidy. This is particularly true for PPA-based private wire development models, where behind-the-meter wind generation can allow industrial energy consumers to self-supply much of the power they need. Co-locating small and medium scale wind generation with power demand centres can help to minimise energy costs for UK business and industry - a key goal of the draft Industrial Strategy. If this was supported by increased energy management and efficiency savings and complemented by energy storage technologies, some industrial sites could become completely energy self-sufficient including EV and HV (Hydrogen Vehicle) charging stations.
Community energy groups
Community energy groups in England are prevented from developing wind energy projects that can bring local benefits.
No community wind projects have submitted planning applications since the WMS was introduced, while one 7MW scheme in West Yorkshire withdrew its planning application. Recent survey work by Centre for Sustainable Energy (CSE) shows that a majority of planning officers in England believe the WMS makes it harder for communities to bring forward wind projects. Where one side of a community supports a scheme and another group opposes it, how should planning officers determine whether the application has the support of the community or not? This remains unclear, and stymies community groups with limited resources being able to bring forward projects that can bring local benefits. In practice, communities have lost agency as a consequence of a policy change whose stated aims included giving them more choice, not less.
For example, Bristol Energy Network - a co-signatory to this response - is working with one of its community members, Ambition Lawrence Weston, to develop a community-led wind turbine. While this has the support of the community, and would provide an opportunity for a significant community benefit fund to tackle fuel poverty and social inequalities, the new planning regulations have made it extremely difficult to develop the project.
Onshore wind supply chain companies
The onshore wind supply chain, particularly at the small and medium end of the market, supports British businesses and jobs - and is now under severe threat.
The onshore wind sector provides skilled, sustainable jobs distributed across the UK with hundreds of companies involved in the supply chain beyond manufacturers. Onshore wind expenditure has a high domestic content at 69% (Policy Exchange) and supports over 12,000 jobs (RenewableUK). Continuing to freeze the UK onshore wind market will entail losing existing jobs and lowering investment in skills and training in future positions. Smaller and medium scale manufacturers, of which several are UK companies, in particular stand to benefit from changes that enable communities, businesses and farmers to bring through smaller scale developments.
Practical problems with implementing the WMS
Designation in Local and Neighbourhood Plans
Local authorities lack the resources or capacity to appropriately plan for wind energy.
Because Local Plans do not oblige local authorities to identify areas as suitable for renewable energy development, many local authorities are choosing not to carry out this work. Based on their 2016 survey results, CSE estimates that onshore wind will not now be able to be developed at any scale in around two thirds of English local planning authorities for the foreseeable future. Furthermore where local authorities do wish to plan for renewable energy, there are additional costs associated with non-token assessment of wind resource and designation of sites. In the context of shrinking local authority budgets this is likely to lead to wind designation being de-prioritised.
‘Fully addressing’ identified impacts and establishing local community ‘backing’
Local planning authorities do not understand the community ‘backing’ requirement, meaning the risk of submitting an application is deemed too high.
Nowhere else in the NPPF do the phrases ‘fully addressed’ or ‘therefore has their backing’ appear - the conditions are unique for onshore wind. Without specific guidance or criteria it is extremely unclear what additional conditions - if any - beyond the normal planning determination process this places on onshore wind applications. CSE’s November 2016 survey of planning officers found that only 14% felt that the existing guidance on this test is clear enough to support predictable planning decisions. Asked if they were themselves confident that they understood how this condition could be met by planning applicants, only 26% replied that they were. The stated confidence of the 26% group is further undermined by the fact that comments expressed by officers gave a wide range of different interpretations of what ‘fully addressed’ means in practice. Investing resources in a wind energy application in this context becomes intolerably risky, especially for community-led projects.
Meaningful local participation and engagement in planning decisions regarding wind energy is essential - but the result of the WMS has been to create extreme uncertainty, and hurt communities, businesses and farmers it was not designed to undermine. Changes to paragraph 98 must reflect these learnings and ensure a reasonable balance.
We share the view that local communities’ interests were not being adequately served under the pre-WMS regulatory regime for onshore wind, and we supported the removal of wind farms of over 50MW from the Nationally Significant Infrastructure Projects (NSIP) regime as part of the government’s approach to giving communities more of a say on local wind projects. The top-down imposition of large scale industrial developments on sceptical rural communities who derived little or no benefit from hosting this important infrastructure was a mistake that has indeed had a corrosive effect on the social licence of the UK wind industry, at least at a localised level amongst certain demographics.
Nevertheless we believe the conditions imposed via the WMS are the wrong political solution. These place unjustifiably onerous demands on a cheap and valuable technology that consistently enjoys support of Conservative and non-Conservative voters alike and offers local and national benefits. In doing so, the WMS fails to ‘give local people the final say on wind farms’ - as the need for designation means potential applications are often blocked before they can reach planning deliberation - and in fact undermines the agency of ‘communities that want more onshore wind’. Furthermore, British farmers and businesses are being denied valuable opportunities to reduce energy costs and exposure to price volatility while contributing to national decarbonisation.
1. Provide adequate resource and framework for the identification of suitable areas for renewable energy in Local and Neighbourhood Plans
Government should establish a framework to support the development of Local Plans which actually meet the requirements of the NPPF on renewable energy and reflect the implications for spatial and local planning that national climate targets confer on localities. There must be identified resource for local authorities to carry out this work - in particular where they choose to identify sites suitable for wind development which entails extra costs to be completed to an appropriate standard. Mapping the national wind resource more accurately and publicly to Local Authority levels could help to direct future wind developments more effectively. Additionally, for areas where a local plan has not yet been adopted government could consider allowing applications to be submitted for wind energy development on a criteria basis until site allocation is completed by the LPA.
2. Remove or clarify the community ‘backing’ criterion
We welcome the intention to clarify the criterion for local community backing. However, the planning system already contains provisions for establishing local support for proposed developments. Ideally therefore the additional requirement that ‘planning impacts identified by affected local communities [are] fully addressed and therefore the proposal has their backing’ should be removed altogether to remove confusion. Failing that it should be replaced or complemented with a set of substantive criteria that require planning impacts identified to be material to the application in question, and that are consistent across all local authorities so that prospective developers can understand what threshold they are required to meet. We propose that the NPPG’s suggestion that local authorities develop planning policies that give material weight to community leadership, ownership or meaningful involvement in renewable energy schemes could also constitute an appropriate criterion for satisfying this test.
3. Provide exemption from rules introduced in the WMS for community-scale wind projects
The Feed-in-tariff regime treats renewable energy developments under 5MW capacity as community-scale - and the vast majority of onshore wind Fit projects are within the 1.5MW threshold. We believe that either of these capacity thresholds would be an appropriate definition to adopt for an explicit exemption from the WMS conditions for consent for wind energy applications. Farmers and businesses seeking to self-supply alongside community energy groups would all be free to progress small to medium scale wind energy developments without prejudice under the standard planning system, while utility scale wind farms would remain subject to the additional constraints introduced by the WMS subject to any future changes. This would ensure that England is able to continue to benefit from its wind resource, creating a pipeline of community scale projects that will contribute to British energy security and decarbonisation goals, as well as throwing a vital lifeline to domestic wind industry supply chain companies.
Leo Murray, director of strategy, 10:10
Richard Hatton, country manager at Enercon GmbH-UK
Jonathan Scurlock, chief adviser, renewable energy and climate change at National Farmers' Union
David Tudgey, project development officer at Bristol Energy Network
Dale Vince, founder of Ecotricity
5,732 members of the public
We need to raise the volume on onshore wind and show how many of us support it. Please share and ask your friends to join the movement.
To Philip Hammond (Chancellor of the Exchequer) and Greg Clark (Secretary of State for Business, Energy & Industrial Strategy):
Ensure that the cheapest forms of clean energy - onshore wind and solar PV - are not frozen out of the UK energy system, by reinstating a competitive financial support auction for future projects.
Dear Mr Hammond,
Enabling the UK’s cheapest low carbon energy technologies to compete
In 2016, a record breaking 25% of our electricity mix came from renewables, according to the government's own figures. We welcome the government's moves to further this record thanks to their investment in less established technologies such as offshore wind, as well as their commitment to demand side response and battery technologies in the December capacity market auction.
We’re now awaiting the announcement on the future of the Levy Control Framework after 2020, which we understand will be announced in the Spring Budget.
As the principal control mechanism to ensure value for money for energy bills payers as we accelerate the UK’s decarbonisation, this announcement will have significant consequences for future investment decisions and costs borne by consumers.
As such, we believe it is imperative that a stable future deployment pathway is established for the two cheapest sources of low carbon energy - onshore wind and solar PV - so as to ensure we achieve maximum decarbonisation while protecting consumers from higher bills.
Onshore wind is low cost
According to the National Audit Office, onshore wind is the UK’s cheapest form of new build capacity. Even less bullish estimates, such as the BEIS autumn 2016 cost assessment, expect onshore wind to undercut new CCGT between 2018 and 2020. Onshore wind is the cheapest new low carbon power source we can build.
Excluding it from financial de-risking policies, and therefore blocking most projects’ route to market, will increase the cost of decarbonisation to the bill payer. It will also undermine the government’s manifesto pledge to achieve the lowest cost decarbonisation.
The cost of excluding onshore wind is significant for the billpayer
The Citizens Advice Bureau, in collaboration with NERA Economic Consulting, modelled the impacts on the overall cost to decarbonisation of excluding onshore wind from CfD auctions in 2015. They found that for each CfD auction round run without onshore wind, an additional £500m would be added to consumer bills over the 15 year contract period. With multiple auctions likely to be run to bring forward sufficient low-carbon power investment to meet emissions reduction targets, this additional cost could easily become a multi-billion pound proposition.
Policy Exchange similarly identify that replacing 1GW of onshore wind deployment with the equivalent amount of generation from offshore wind would add £75-90m per year.
With ambitious emissions reductions targets written into domestic law the UK has to invest in rapidly decarbonising the power sector. Onshore wind provides the most cost effective way to do this. The figures quoted here highlight the danger of escalating costs of alternative options if a route to market is not provided.
Solar PV cannot fill the gap
It is particularly troubling for the effective use of public resources that, due to the state aid rules surrounding the CfD mechanism, scale solar PV is also unable to bid for the same financial security that less mature renewables, fossil and nuclear generators have access to (via either CfDs or the capacity market).
As the UK’s second cheapest - and rapidly cheapening - low carbon power source solar PV might have been able to lessen the cost impact of excluding onshore wind from CfD rounds. However, by failing to run any Pot 1 CfD auctions, this mitigation is precluded, so the full additional cost implications will be realised.
This is compounded by the sudden reduction in FiT rates in 2015, which have led to an 83% reduction in average quarterly deployment of PV under the FiT in Q1-Q3 in 2016 compared to the same period in 2015 - according to the Solar Trade Association.
Freezing out the UK’s cheapest low carbon power sources
The decision not to run future Pot 1 CfD auctions means freezing the UK’s two cheapest low carbon power sources out of new energy investment and deployment.
This will have several negative consequences.
First, as discussed, it will increase the cost of the UK’s decarbonisation.
Second it will endanger crucial supply chains, skills and investment. 70% of spend on onshore wind over a turbine’s lifetime is in the UK. Thousands of jobs are supported - with the potential for strong growth. Skills needed to build on the huge success of renewables deployment in the UK over the last decade are at risk of being lost as pipelines dry up and jobs are lost - Endurance Wind UK’s closure is just one example. Investment is also being stymied: the unexpected early closure of the Renewables Obligation led more than half of major onshore wind lenders to say they would not lend in future. This trend will continue if the financial de-risking permitted for other technologies is not reinstated for wind. More broadly, the Office for National Statistics found that the UK’s clean energy sector shrank by 8.7% between 2014-15, in part due to policy changes affecting onshore wind and solar PV.
Third, it endangers public consent for the necessary transition to a low carbon economy. While public support for renewables remains very high (over 70% for onshore wind and over 80% for solar PV), concerns over the cost of energy have the potential to derail necessarily ambitious decarbonisation plans if ‘green taxes’ are identified as causal factors. Notwithstanding the undeniable long term cost and environmental benefits of investing in renewables, it would be prudent to honour the Government’s manifesto commitment to lowest cost transition in order to ensure public consent for action on climate change remains strong.
Fourth - and most importantly - for all of the reasons above it risks endangering the UK’s ability to meet its global climate change obligations. Since the Paris Agreement in 2015 a new global consensus has emerged over the need to work together to prevent catastrophic climate change. In order to achieve this all countries need to up their ambition - the UK will struggle to do so by ignoring some of the best tools available to build the transition. Domestically the Committee on Climate Change identified the lack of support for onshore wind as a policy gap in its June 2016 progress report to Parliament on meeting the UK’s own carbon budgets.
Reinstating support for onshore wind and solar PV
In light of all these considerations we the undersigned call on the Government to ensure that the cheapest forms of low carbon power - onshore wind and solar PV - are not frozen out of the UK energy system, by reinstating a competitive financial support auction for future projects. Future Pot 1 CfD auctions can be amended, with a tapering cap on the administrative strike price, to ensure further cost reductions over time. By holding the strike price for onshore wind level with the cost of a new CCGT plant the Government can honour its manifesto commitment not to provide new subsidy to onshore wind.
Both onshore wind and solar PV deserve the ability to compete on a level playing field with other generation technologies. As things stand the Government is picking winners before the game's even been played.
We would welcome a meeting to discuss this further and look forward to hearing back from you at your earliest convenience.
When the government chose to freeze out cheap and clean onshore wind power from the future of the UK’s energy system, it launched a two pronged attack.
One was the removal of the financial support it deserves in order to compete fairly with other energy sources, like fossil fuel generators, which still receive public subsidy. We’ve done a lot of talking about that since we launched Blown Away in October.
But we’ve talked less about the other one: new planning barriers.
We know newspapers listen to their mailbags, so now is the time to let the Mail know people like it when they write positive news stories about onshore wind. Send the Mail on Sunday and email (and copy in the Daily Mail too) telling them you'd like to see more articles like the one from last week.
Make sure you mention that backyard wind turbines are only a small part of the story. Everyone benefits from lower bills if we build the cheapest form of new energy - onshore wind.
You can also mention other reasons you support onshore wind.
Send your letter to the Mail on Sunday: email@example.com
Make sure you copy in the Daily Mail: firstname.lastname@example.org
The Blown Away quiz makes a number of assumptions, but seeks to provide an indicative sense of the scale of support being offered to fossil fuel generators, compared to the total absence of support for onshore wind power at scale.
Our estimations were derived from the following sources:
2,800 turbines is derived by dividing 7GW by average turbine size of 2.5MW, assumption used by RSPB in their 2050 Energy Vision report.
18.4tWh annual energy delivered also scaled from RSPB 2050 Energy Vision report.
6% of UK annual electricity demand derived by scaling from a New Scientist article which states Hinkley C would provide 24tWh annually, equating 7% of annual UK electricity demand.
£550m spent on diesel and coal power refers to £549m worth on capacity market contracts allocated to diesel (£176m) and coal (£373m) fired electricity generators in the 2014 and 2015 capacity market auctions.
Two further capacity market auctions will run in December 2016 and January 2017, and are expected to allocate around £1bn. For more information click here.
There's one more thing you can do - will you share the message with your friends so more of us can stand up for renewables?
You've signed our petition asking the government to ensure dirty fossil fuels aren't subsidised more than clean onshore wind. Thank you!
We'll be sure to send you updates about how the campaign is going and info about other ways you can support onshore wind.