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11:00 - 17 June 2004

Government plans for a massive increase in the number of windfarms will push up electricity prices and do little to tackle global warming, a devastating new report has warned.

The report, "Tilting at windmills: the economics of wind power", concluded that the Government's "preoccupation" with windfarms will cost consumers billions of pounds but "make no substantial contribution" to reducing the carbon dioxide emissions blamed for global warming.

The detailed report was drawn up the respected economist Professor David Simpson on behalf of the independent Scottish think tank, the David Hume Institute.

Science Minister Lord Sainsbury dismissed the report. But its findings will be deeply embarrassing for ministers who have made windfarms a key plank in their strategy for tackling global warming.

Professor Simpson, a former advisor to the World Bank, said the intermittent nature of wind power meant it was unlikely ever to make a significant contribution to cutting carbon emissions because it would always need back-up from other sources.

"No matter how large the amount of wind power capacity installed, the unpredictably variable nature of its output means that it can make no significant contribution to the security of energy supplies," Professor Simpson added.

The report also warned that reliance on wind power would force up electricity prices. Professor Simpson said the cost of upgrading the national grid to deal with wind power could reach 4.5 billion, with the cost of economic support to the wind industry running at 1 billion a year by 2010.

The report said wind power was "unlikely" to be the most cost-efficient way of cutting carbon emissions. And it accused ministers of ignoring other forms of renewable energy, saying that it was "likely that the energy technologies that will play an important part in the economy of 2020 do not feature prominently in current Government policy".

Professor Simpson said: "In Cervantes' novel, Don Quixote mistook windmills for his real enemy, giants. This paper suggests that the present Government's preoccupation with renewables, and in particular with wind power, may likewise be a distraction from its real objectives in the field of energy."

The Government's decision to concentrate on wind power rather than other forms of renewable energy has proved highly controversial in the Westcountry and other affected areas where campaigners claim giant turbines ruin the landscape. But the new report focuses on the economic claims of ministers and the wind industry. Among its findings are:

Wind energy is around twice the cost of the cheapest conventional energy

The extra cost of renewable already adds two per cent to domestic electricity bills - a cost that is set to grow. "Most consumers are unaware that they are paying this hidden levy, and they do not know what they are getting for it"

Meeting a government target of 20 per cent of electricity generated by wind power would cost consumers 1.2-2 billion a year extra

The Government's target will require a major re-engineering of electricity transmission and distribution networks, costing an extra 2.5 - 4.5 billion.

Lord Sainsbury insisted that the decision to concentrate on wind power was not driven by ministers.

"Wind power has been chosen by the industry because it thinks it is the cheapest method of achieving the renewables obligation. That is why it has chosen wind."

In a short debate in the House of Lords peers urged the Government to heed the report's findings. Tory peer Lord Crickhowell said that the "high cost" of wind power, coupled with the "environmental desecration to many of the most beautiful parts of the British Isles," meant that the Government should look at other renewable sources, like tidal and wave energy.

However Lord Sainsbury said: "While the Government agrees with a few of its points, the report makes many inaccurate statements."

The minister said that the report had downplayed the costs of the nuclear industry, seen by some as an alternative "clean" form of energy. He added: "I find it strange that in the report there is a whole page which deals with the problems of birds flying into wind turbines, while the environmental impact of nuclear power is dealt with in one line."

Cross-bench peer Viscount Tenby suggested ministers should learn lessons from Denmark, where the Government has virtually halted windfarm development, "before too much of our beautiful landscape is visually impaired".

Lord Sainsbury said the comparison was irrelevant as Denmark had ten times the number of windfarms in the UK.