Recently, this blog reported the not very widely known or reported fact that the contribution of wind decreased last year by 6% despite building 20% more wind farms. This was because the capacity factor (actual output / maximum output) dropped to 27% in 2016. Or another way of saying this is that there was less wind blowing last year.
At the same time, the PSO Levy, which pays wind farms the difference between the subsidized price and wholesale price, increased last year by 20% (some of that going to peat). This is a bit of a paradox - wind farm installations increased by 20% but total wind output dropped by 6%, yet the subsidy for wind increased by 20%.
If a farmer cut his herd or crop by 6%, would he receive more subsidies ?
The answer is that the Energy Regulator estimates the PSO Levy a year in advance. For 2016, the wholesale price dropped much more than was estimated and so the PSO Levy had to increase to compensate for this large drop in market prices (called the R-factor).
Another paradox is that the PSO is also paid to higher emitting peat generation at the same time as wind generation. So some, if not all, the CO2 savings from wind have been cancelled out by the use of peat generation instead of gas. PSO payments to peat are due to be phased out by 2019.