MPs say wind farm contracts are 'shocking'

Wind farm PFI deals are 'shocking', the Public Accounts Committee said (Getty Images)

Families could face higher electricity bills as a result of "shocking" blunders in awarding new contracts for offshore wind farms, a group of MPs has warned.

Private Finance Initiative (PFI) deals worth £17bn, agreed with companies for transmitting wind power to the mainland, showed that the Government had failed to learn from earlier poor PFI contracts and the costs would eventually be passed on to consumers, the Public Accounts Committee said.

A report published today looks at the "elaborate" new system that licences companies to bring power onshore. Companies are guaranteed an income linked to RPI inflation for 20 years, regardless of how much the infrastructure is actually used, and the study says estimated returns of 10-11 per cent "look extremely generous given the limited risks".

The Department for Energy and Climate Change (DECC) hopes that offshore wind farms can provide up to 15 per cent of electricity needs by 2020. But that will require about £8bn of infrastructure investment.

A DECC spokesman said: "The offshore electricity transmission regime harnesses competitive forces to drive value for money for consumers. We will respond to the detailed points made by the Public Accounts Committee in full in due course."