Community Windpower Halts 308MW Sanquhar 2 Wind Project in Scotland Due to ‘Windfall Tax’ Woes

Credit: Community Windpower

has announced the suspension of its ambitious 308MW Sanquhar 2 onshore wind project located in . The decision to put the project on hold is attributed to what the company terms an “unfair ‘Windfall Tax'” imposed on new renewable power plants.

In an official statement, the company lamented the project's current status, stating, “Sanquhar 2 was projected to cost approximately £300 million; however, infrastructure costs have been hit by a triple whammy of extreme inflation, a four-fold increase in interest costs, and a weakened pound. These factors have driven costs beyond £500 million.”

Remarkably, despite these financial challenges, the project still represented a more cost-effective alternative to gas-fired electricity generation. Community Windpower expressed its concern over the fact that gas generators remain exempt from the ‘windfall tax.'

To address this issue, Community Windpower is urging the UK Government to reconsider its stance on taxing new renewable projects and is advocating for their exemption from the windfall tax. Additionally, the company has called for the introduction of investment allowances in line with those available for oil and gas projects, aiming to create a more level playing field for initiatives.

Furthermore, the company proposed the implementation of a sunset clause for the windfall tax, aligning the UK with policies in place in and the .

Sanquhar 2 had received planning consent at the end of August, and its delay is seen as a setback for Scotland's renewable energy ambitions. This development highlights the challenges faced by renewable energy developers and underscores the need for policy adjustments to support the growth of sustainable energy projects in the UK.

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