Scottish Wind Power Plants Paid Not to Produce

Michael Giberson

The Telegraph has reported “six Scottish wind farms were asked to stop producing electricity on a particularly windy night last month as the National Grid was overloaded.” The operators were paid a total of £900,000 to take the night off, likely earning more from not operating than they would have earned from selling power that night.

The payments were discovered by the Renewable Energy Foundation, a green think tank, which accused the Government of building too many wind farms in northern Britain.

John Constable, director of policy and research, said not enough care had been taken to ensure there were enough high-voltage cables to transfer the power to other parts of the UK when it was needed.

“Hasty attempts to meet targets for renewable energy mean some Scottish wind farms are now in the extraordinary position of not only printing money when they generate, but printing it even faster when they throw their energy away,” he told the Sunday Times.

The Renewable Energy Foundation provides additional information on its website:

7 thoughts on “Scottish Wind Power Plants Paid Not to Produce

  1. Eric, I don’t know and have not had time to check on the underlying congestion management details. Do you know the details. I wondered why they didn’t hold the hydro in the reservoir and use the wind (presumably the reservoirs are at capacity?).

    Also wondered about the payment mechanism that seems to be so generous.

    When I’m back home I’ll be working on a paper on negative prices, so this story caught my eye.

  2. One thing about all these wind farm shutdowns that does not seem to be discussed enough is that there may be times when the most efficient market solution is paying wind farms not to produce, so long as these times are infrequent and the benefits while they are producing outweigh the costs of asking them to shut down. Although mechanisms to pay consumers to use more electricity at such times might be more economically efficient. Hope you cover this in your paper on negative prices.

  3. Tom:

    Good second point, backwards first point. The “mechansims to pay consumers to use more electricity at such times” is in fact to have the wind farms pay to put it on the grid at such times if they so insist.

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