The viability of new wind farm projects is expected to be challenged due to a new price cap introduced in the upcoming Renewable Electricity Support Scheme (RESS).

Now in its fourth iteration, RESS sees solar and wind projects compete to secure 15 years of Government support.

The auction is set to take place next month. However, the Department of the Environment, Climate and Communications' recent decision to reduce the RESS4 auction price cap for onshore wind projects is expected to challenge the business case for new projects, according to Aurora Energy Research, the global energy analytics provider.

Cap

Aurora’s latest analysis indicates that the auction is unlikely to achieve its target of 2,500GWh to 4,500GWh of new projects due to a lack of eligible and profitable projects under the new reduced cap price.

The introduction of technology-specific caps, which lowered the onshore wind cap from €110/MWh to €93.50/MWh, may result in fewer projects being able to secure financing under a RESS4 contract, Aurora has stated.

Furthermore, the increased lenience in eligibility, which now allows projects under judicial review to enter the RESS4 auction, is not expected to widen the pool enough to meet the procurement target, Aurora says.

The long-stop date for these projects to come online is 31 December 2029, effectively making it the last auction to procure capacity to meet the 2030 targets of 80% renewable electricity, 9GW onshore wind and 8GW solar PV.