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Windfarms renege on electricity contracts for a second year

Gaming the system may cost consumers one £billion

Major windfarms are again reneging on their promise to deliver power to the national grid at agreed prices.

A year ago, Net Zero Watch reported that the Moray East windfarm had become fully operational, but had refused to activate its Contracts for Difference (CfDs), under which it had promised to sell cheap power to the grid. This gaming allowed it to sell at elevated market prices instead, costing consumers hundreds of millions of pounds.

Last week the windfarm advised that it will put back the date for activation another 12 months. In addition, the CfD start date for Phase 1 of the Hornsea 2 windfarm, which became fully operational in August last year, has also been pushed back into 2024.

Delaying its CfD may have earned Moray East as much as half a billion pounds last year; putting it back another year could easily bring in another one or two hundred million pounds. Hornsea 2 could earn twice as much in 2023/24.

Windfarms are entitled to do this under the CfD scheme rules, and there is scope for further delays. Moray East will be able to put off a final decision about whether to activate its CfD until March 2025. Some of the phases of Hornsea 2 will be able to delay until 2026.

Andrew Montford, Net Zero Watch deputy director, said:

How long do Government and civil service think they can go on pretending that these windfarms are going to deliver cheap power? It is a deliberate, cynical deception and it needs to stop now.”