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Boost for wind farm profits

A briefing document on the wind industry written for investors – and seen by The Sunday Telegraph – shows how attempts to increase the supply of green energy will make turbines far more profitable over the next decade.

It predicts that wind farms will generate greater income following the introduction of a new tax on energy from gas and coal-fired power stations because it will drive up the cost of electricity over the next seven years, the Sunday Telegraph reported.

The new tax, intended to cut pollution from traditional sources of electricity, will allow wind farm operators to charge more for the power they produce, with the extra costs expected to be passed on to consumers through their bills.

Energy industry experts predict the new tax will cost electricity customers an extra £1billion a year from 2016.

The documents seen by The Sunday Telegraph show how wind farms are already making hundreds of millions of pounds of profits, with half the income from existing consumer subsidies. It also showed how coal-fired power plants are being forced to close ahead of the new carbon tax as it will make operating too expensive.

The details are contained in a 70-page prospectus drawn up by Barclays Bank and sent to financiers looking to invest up to £260m in a new energy fund, Greencoat UK Wind, which is planning to buy stakes in six big wind farms around the UK.

The Renewable Energy Foundation (REF) has seen the briefing reported by the Sunday Telegraph.

REF director Dr John Constable said: “These documents show that investors are set to reap a major subsidy windfall on top of subsidies that are already thought to be excessive.

“As a matter of priority the prime minister and the chancellor must step in to protect the consumer by making retrospective reductions in the Renewables Obligation to offset the effects of the Carbon Price Support tax.”

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