Failing to produce energy can be a lucrative green business — at least in the United Kingdom. The Telegraph reported over the weekend on the millions of pounds paid to wind farms in compensation for turning off their turbines:
National Grid is responsible for managing the flow of electricity and hands producers “constraint payments” to shut down when there is a risk of the grid overloading because too much is being generated.
Each owner asks for a particular sum for each megawatt hour of energy its turbines would have produced had they been switched on, and National Grid chooses whether to accept their assessment.
According to the Telegraph, renewable energy companies sometimes made almost “double what they would have received for producing energy.” ScottishPower, a Spanish-owned wind farm, made £11 million in the past three years. Meanwhile, at least 10 wind farms earned £3 million for shutting down energy production. And “total payments since 20111 have exceeded £70 million.”
The cost is passed on to consumers, the Telegraph notes:
The money, which is ultimately added to household bills, is being paid to a series of firms, including a handful owned by the Swedish, Norwegian and Danish governments.
Read the rest here.
— Jillian Kay Melchior writes for National Review as a Thomas L. Rhodes Fellow for the Franklin Center. She is also a Senior Fellow at the Independent Women’s Forum.