News Story

PROPOSED BULLINGTON CROSS WIND FARM WOULD CONTRIBUTE £10 MILLION TO LOCAL ECONOMY


10/06/14

The proposed Bullington Cross wind farm would make a significant economic contribution to the local community according to figures provided by EDF Energy Renewables.

In a breakdown of the economic benefits associated with the proposed 14 turbine wind farm, the company estimates that, if the project goes ahead, around £10 million would be injected into the local economy and host communities over the anticipated 25 year lifetime of the wind farm.*

The local economic benefit forecast for the wind farm takes into account the effect of the local community benefit fund which would be established if the project is consented, the potential for local contractors to gain business during the construction phase and also the scheme’s contribution to local business rates which would be retained by the local councils.

Darren Cuming, EDF Energy Renewables development manager for the Bullington Cross project, said:  “This is a clear indication of ways renewable energy projects like these can make a real difference to local communities.

“The proposed Community Benefit Fund and the ability of local authorities to retain business rates from renewable energy projects would together have a significant positive impact for both council and community activities at a time when local front line public services are under pressure. 

“In addition, our local contracting strategy will bring opportunities for local suppliers during the construction phase, in addition to the local expenditure on hotels, shops, restaurant and local services.

“We believe that Bullington Cross is an excellent location for a wind farm and that it will provide significant economic, environmental and energy security benefits.”

The proposed Bullington Cross scheme would provide enough low carbon energy to meet the average annual electricity demands of  up to 15,000 households and will contribute towards reduced UK emissions targets by offsetting the annual release of in excess of 27,000 tonnes of carbon dioxide.**

In addition to the direct economic benefits, EDF Energy Renewables has agreed a Memorandum of Understanding with Hampshire Renewable Energy Co-operative that will give it the option to purchase a revenue share of up to 10% in the wind farm development on behalf of its members.

Funds generated by the wind farm stake will be used to pay an annual interest to members, with any surplus being re-invested by the co-operative in other local community owned renewables projects.

The planning application for the project is due to be determined by a special meeting of the planning committees of Winchester City Council, Basingstoke and Deane Borough Council and Test Valley Borough Council on Monday, 16th June.

*The £10 million figure excludes any future returns that would be provided by the community ownership arrangement currently being discussed with Hampshire Renewable Energy Cooperative. 

The estimate also does not take into account any local business benefits that may arise from any operations and maintenance arrangements during the operational lifetime of the wind farm or from the decommissioning of the wind farm at the end of its operation.

More details on the local economic contribution of the proposed Bullington Cross wind farm are as follows:

A dedicated local Community Benefit Fund would be established that would provide a fund of £5,000 per installed megawatt (MW) each year over the lifetime of the wind farm. This would provide a locally administered fund of up to £140,000 each year and a total of £3.5 million over the expected 25 year lifetime of the wind farm. The fund would be used for the benefit of local projects, events and community organisations, potentially under the direction of the Hampshire and Isle of Wight Community Foundation in association with local parish councils.

Local business rates payable in respect of the scheme will be retained by the local authorities concerned. This would be approximately £7,000 per MW (or around £14,000 per turbine) of installed wind farm capacity***.  For the three local authorities involved in this scheme, this would be around £98,000pa for the turbines proposed in Winchester, £56,000pa in Basingstoke and Deane and £42,000pa in Test Valley.

EDF Energy Renewables’ contracting strategy encourages packages of work associated with the construction of the wind farm to be made available to local suppliers and contractors. In addition to direct contracts there is the wider benefit to the local economy during the construction phase with expenditure on hotels, shops, restaurant and local services. For the Bullington Cross project, based on a comparison with our other schemes, we would estimate that the potential commercial contribution to the local economy arising during the construction stage of the project would be in the region of £2m to £2.5m****.

**Please note these figures are based on onshore turbines operating at 26.06% capacity factor (2008-2012 average load factor for onshore wind from Digest of UK Energy Statistics) and assuming 4,222 is the average UK household electricity consumption in kW hours (based on DECCs publication URN:13D/310 December 2013).

***Please note this figure is an initial estimate based on a rateable value of £15K per MW which is multiplied by the current Uniform business rate of 47.1p in the pound to give an expected annual payment of around £7,000 per MW or £14,000 per turbine, assuming a 2MW turbine is installed.  Actual figures would be agreed between the developer and the Valuation Office Agency (VOA) once operation commences and would be levied on the wind farm operator by the local authority. 

**** The figure of estimated local economic contribution during the construction phase is based on an expectation that it would amount to between 30 to 35% of the detailed estimated costs for the civils construction activity estimated as £6.5m (this being the civils direct estimate of £5.838m plus 40% of a circa £1.5m contingency).

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