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The UK onshore turbine business is being buffeted by crosswinds - political, financial and regulatory. As the government plans electricity market reform, is the climate turning hostile? David Thame sticks his finger in the air
The party is almost over. Despite "approval for the latest big wind farm plan - ScottishPower has just won consent for a mighty 96-turbine 288MW array at Kilgallioch in the Scottish borders - there is a distinct feeling of the morning after the night before in the UK wind sector.
After 10 years of growth, the UK onshore wind energy business has probably peaked, and attention is now turning to small-scale, single-turbine projects in the UK and the larger prospects of development in Ireland.
That is the view of many in the wind energy sector as the government prepares for complicated energy market reform. They say a change in political climate, the relative scarcity of good available sites, a review of the current funding levels and looming changes in the subsidy regime mean that the days when wind was king of renewable energy could now be behind us.
David Eynon, senior sustainability ," adviser at Colliers International, says: "The party may be over under the present framework."
Meanwhile, new rules on wind energy procurement and subsidy have caused confusion and have been criticised for their complexity. Introduced under the Energy Bill, they are called "Contracts for difference" (see p71).
"Investors are getting tired because of a lack of clarity from investors," says Eynon. "There is concern that legislation needs to be clarified."
Last year, Aviva Investors and SachsenFonds completed one of Europe's largest wind energy deals by acquiring the 49.4MW Almatret wind farm in Spain from Element Power. Aviva says it can cope with the complexity of regulation, but wonders how many others can.
Ian Berry, specialisl fund manager at Aviva Investors, talks regularly to the Treasury and the Department of Energy and Climate Change and has told them the new rules are too complicated.
"On the face of it, the contracting for difference rules are surprisingly complicated," he says. "Why should a new...