Closing the Renewables Obligation to onshore wind a year early could threaten 19,000 jobs supported by the industry.
There were about 11,000 people directly employed by onshore wind and 8,000 in 'supply chain' roles in 2013, according to government estimates. It's uncertain how many people will see their employment threatened by the closure of the Renewables Obligation
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"These changes to the financial support for onshore wind threaten the future of 19,000 jobs supported by that sector."
Lord Grantchester, 22 July 2015
The Labour peer Lord Grantchester has suggested that closing financial support to onshore wind (in the form of the Renewables Obligation (RO) a year earlier than planned could threaten 19,000 jobs supported by the industry.
While an amendment has removed that part of the energy bill for now, the government has told us it intends to reintroduce it in the Commons.
The 19,000 figure comes from 2013. It breaks down into 11,000 people directly employed by onshore wind, and 8,000 people employed in 'supply chain' roles. It's not easy to tell how many of these people would have their employment threatened by the changes.
19,000 people were thought to be employed in roles supported by the sector in 2013
There were 11,000 people directly employed in the UK's onshore wind sector in 2013, with another 8,000 people employed in roles supplying goods (such as electrical cables) and services to the sector, according to a report commissioned by the Department of Business, Innovation and Skills (BIS) published earlier this year.
We don't know what effect closing the Renewables Obligation would have on employment
Jobs associated with onshore wind aren't all permanent; some of them are associated with the construction of projects, and others with their operation and maintenance once built. To the extent that certain projects may not proceed as a result of the early RO closure, jobs may be impacted.
The government's impact assessment notes that the changes "could lead to a reduction in the number of people employed in the onshore wind sector", but that "the net impact on GB-wide employment is uncertain".
The government's best estimate is that roughly 200 megawatts worth of windfarm capacity that would have been built by 2020 won't be if the Renewables Obligation closes early, although the reduction in capacity built could be anywhere between 0-2,500 megawatts. It is not possible to translate this figure directly into jobs on the basis of the BIS data.
Different projects would feel different effects
Jobs associated with wind farms that are already up and running under the Renewables Obligation are unlikely to be affected; the Department of Energy and Climate Change has confirmed to us that existing schemes will continue to receive support.
But jobs associated with the construction of new projects could be threatened, including roles in the supply chain. In the short term, if projects are cancelled, then construction work that would have been associated with these projects won't go ahead. In the longer run, jobs associated with the maintenance and operation of these projects won't materialise.
The grace period could mitigate some impacts
The government's plans for closure of the RO (before they were rejected in the Lords) would have affected projects that would have qualified for the scheme between April 2016 and 2017 (when the renewables obligation would have closed to all new projects anyway).
There might have been some exceptions; the government proposed a grace period for projects that had planning consent by the 18th of June 2015, so exactly how the early closure would have affected them isn't clear. If these projects progress as originally planned, then there would be no net impact on jobs for these projects. Projects—and jobs related to them—which had started but not gained planning permission by this date would be affected.
We don't know if these proposals will change when the government re-introduces its plans.
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