NEW rules for wind farms could reduce the number of new developments in Scotland by 80%, according to a new report.

Highland Council passed a new policy passed a new policy called the Social Value Charter (SVC) in the summer which means energy firms building windfarms are required to increase their community contributions by 150% from £5k per megawatt to £12.5k.

In a report, Biggar Economics has suggested this could mean that four out of five wind farms which have already received consent will now not go ahead, which could lead to a £2 billion loss to the local economy over the next 30 years.

The Highland area is considered critical for the Scottish Government to meet its target to produce 20GW of onshore wind by 2030. Previous research has estimated that around 2.6GW will be required to be constructed in the region to meet this target.

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Based on discussions with developers, it is thought the SVC could reduce the number of new onshore wind projects developed by 80%, meaning only 520MW will be constructed in this time frame.

The report – analysed the expenditure and economic impact of seven onshore wind farms in Highland using supply chain data – found that while the value of those projects that do proceed would provide more per MW, the amount of community benefit funding that would be lost as a result of projects not going ahead would be greater.

Council leader Raymond Bremner told The Herald there was a need to ensure "the wider Highland community can benefit more equally and fairly" from windfarm profits.

Simon Cleary, energy transition director for Biggar Economics, said: “Our analysis shows that four in every five onshore wind farms in the Highlands, which are currently viable, will not go ahead as a result of this new policy.

“The 150% rise in contribution makes the Highlands uncompetitive against the rest of the UK and beyond.

“These are international companies, working across the globe, who may decide that it is simply no longer good business to develop in Scotland in comparison to other countries, particularly in Europe.”

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Sarah Stone, director of social value agency Samtaler, added: “It's absolutely right that onshore wind should deliver benefits for communities and lots of responsible developers are working really hard to ensure that their wind farms do exactly that.

“Highland Council officials told the councillors who voted for this scheme that they had consulted with the industry but either that wasn't true, or they didn't listen.

“We all know it’s a difficult time for the public sector, but as well as he £5000 per MW they pay to communities, onshore wind developers also pay millions in business rates and deliver projects which bring all the economic benefits from the jobs that are created and businesses who are supported in the supply chain.

“It’s a delicate balance but it needs a rethink so it works for everyone.”

Highland Council introduced the policy to capitalise on the rapid increase in energy companies planning to invest in the area and help meet the cost of a £2 billion investment plan, half of which will be spent on schools and roads over the next 10 years.