Airtricity says it will not develop more wind projects

The wind energy company Airtricity has said it will not be developing any further wind projects in the Republic for now because of the uncertainty in the market.

The company's chief executive, Mr Eddie O'Connor, was responding to comments this week from the energy regulator, Mr Tom Reeves, who questioned whether the industry needed further State support.

A company statement said: "Without this support system, the development programme for the entire Irish wind industry, including Airtricity, will be significantly impacted, and as a consequence we would be unlikely to build new plant in 2005."

Mr O'Connor said the company had about 250 megawatts of wind energy projects lined up, but it was not prepared to go ahead with them at this time.

He said the industry was struggling because banks were not prepared to provide finance with the amount of uncertainty surrounding the sector. He said Airtricity was instead looking at developments internationally.

"Tom Reeves has been a good regulator, we are not saying anything against him personally. But he is wrongly informed about this issue".

He said comments by ESB National Grid last year that certain wind energy plants might have to be "constrained" (effectively shut down for a period) when demand was low had created huge uncertainty in the market. "The letter this week from Mr Reeves will only add to that," he said.

Mr Mark Ennis, head of supply at Airtricity, said: "The regulator's comments are potentially misleading. The growth of the industry has already suffered due to an unnecessary moratorium on grid connections. If Ireland does not introduce a support mechanism, it would be the only country in Europe without one," he said.

Mr Ennis said it was important to differentiate between wind power and conventional power. "Financing of wind power is dramatically different to conventional plant with 80 per cent of funding required upfront compared to some 40 per cent for traditional plant.

"To give loans, banks therefore need surety that the income from the farm will cover payments and the support mechanism gives this", he said.