Sanquhar wind farm project delayed over new renewables tax

A major wind farm development in the south of Scotland has been put on hold over the cost of the incoming windfall tax on new renewables plants.

The Sanquhar II wind farm was due to begin operating in 2025.

The company behind the project said the development, which was projected to cost £300m, has been hit by rising costs.

Community Windpower wants the UK government to exempt the development from the tax.

The project as planned would see 44 turbines built across Dumfries and Galloway and East Ayrshire.

It was given the go-ahead in August despite strong local opposition including an objection from Dumfries and Galloway Council, where the majority of the turbines were due to be located.

The scheme had already been scaled down from plans submitted in 2019.

The Chancellor, Jeremy Hunt, announced the Electricity Generation Levy, commonly known as a windfall tax, in November 2022. He set the rate at 45%, while those in the oil and gas sector pay a lower rate of 25% to 35%.

Community Windpower previously said the Sanquhar II scheme would "significantly help" the Scottish government meet its net zero carbon targets.

However, in a statement, it said: "The UK's fourth largest onshore project with 44 turbines - 308MW of much needed green capacity - has ground to a halt as a consequence of the unfair "Windfall Tax" on new renewable power plants."

The statement said costs now exceeded £500m.

The company called on the UK government to exempt new projects from the "windfall tax", introduce investment allowances in line with oil and gas projects, and put a "sunset clause" on the windfall tax, which would limit the time the levy runs.