In November of this year Dutch newspapers reported on a research conducted by the NLVOW, an organisation that defends the interests of people living in the vicinity of windmills. The research critiqued the fact that a lot of relative young windmills are currently being replaced. The problem is that these windmills are too old to qualify for SDE+ subsidies, although they are still functioning correctly. Most of these windmills will be able to run for over 10-15 years from now.
A lot of farmers and energy companies choose to replace their windmills with newer models and sell the old ones on the second-hand market. The NLVOW criticises these companies because they think this will undermine the public support for windmills. According to them this has nothing to do with sustainability but all about gaining double subsidies. They also claim that this will decrease the chance of people living in the vicinity of windmills benefitting financially from the windmills. Considering the fact that this organisation defends the interest of these people, this last statement could well be their real incentive.
The news lead to questions being asked in Dutch parliament by CDA (a christian democratic party) member of parliament Agnes Mulder. Minister Kamp (economic affairs) responded that these newer windmills have a higher efficiency and therefore are able to generate more electricity. Nonetheless, the regulations will be adapted and from 2015 it will no longer be financially attractive to replace these windmills with newer ones.
In a first review of this case I completely agreed with the NLVOW that this was absolutely ridiculous. While researching this column however, my thoughts have changed somehow and I realised that this story has two sides to it.
From a entrepreneurial perspective it is more than logic to replace these windmills when they no longer qualify for subsidies. This is something the NLVOW admits as well. But as stated before, these windmills often don’t end up on the scrapheap but are sold in the second-hand market. In this way, firms or farmers with less financial capabilities are now able to buy a windmill for a lower price that they can use for 10-15 years. This makes wind energy more lucrative for a larger amount of entrepreneurs. Strangely enough, by using this loophole the amount of wind energy can actually be increased. I personally also strongly belief that renewable energy can only be successful by making it more attractive to firms than energy from non-renewable sources.