I don't know how the UK grid works. I know banks and investors won't put money into something if the rules don't give them confidence of a return on investment. Sure there are tech counter examples for investors, but banks are more careful.
Yeah, that confidence comes from the a wind farms business model, backed by a sound economic model. But there’s still risk, otherwise it’s not an investment.
Banks and investors lend/invest in things that are likely to succeed, and pay them back. But there’s no guarantee, and national grid sure as shit isn’t going to provide that guarantee, why would they take on all that risk?
The only guarantee provided to a wind farm by the grid, is that they’ll be able to participate in the market, and that the grid ensures they will take the power they sell in the market, or compensate them if they can’t (curtailment).
But there are no guarantees that there’s someone in the market to actually buy your power at the price you want to sell it. But as wind produces the cheapest electricity around, it’s a pretty reasonable bet that a wind farm can sell it energy for a profit.
Additionally the grid reserves the right to change how the markets work, within reasonable limits, and no doubt are required to take supplier and consumer issues into consideration. But if you don’t like the changes they make, your only recourse is to sue them, and prove they breached the contract. But there’s no guarantee you’ll win.
A smart bank/investor know all of these things, and will have a decent idea of changes that might impact the business model, and the likelihood of them occurring, and thus include those risks in their investment strategy. But absolutely nobody in this game goes in expecting a sure fire win, that’s just naive.
