Finding the only route to a 3 to 5 year payback on farm wind

The client operates an effluent treatment plant serving a dairy processing operation, and holds land that two utility-scale developers had previously appraised for wind. The question put to Arc was narrower: would a single turbine sited near the plant offset the site's own electricity consumption, and would it pay back?

The engagement was scoped initially to a 150 to 250 kW machine. Desktop screening put the hub-height mean wind speed at 5.6 to 6.2 m/s across a 30 m to 50 m hub range, confirmed IEC Class IIIA as the appropriate turbine class, and returned indicative annual production of 263 to 591 MWh. On a capex band of £625,000 to £1,545,000, simple payback landed at 9 to 22 years, with a central expectation of 12.

The client then clarified the actual objective: a budget of £200,000 and a target payback of 3 to 5 years. That is a materially different project, and Arc re-scoped rather than defend the original framing. A 3 to 5 year payback on a farm wind asset is at the aggressive end of what the UK market delivers, and the only way to answer the question honestly was to stop working from desktop assumptions.

Arc requested the electricity bill and the half-hourly consumption data, then rebuilt the model around a 100 kW machine. Three inputs moved, two of them against the client.

Mean demand came out at 89.9 kW and median demand at 94.1 kW. Even at the tenth percentile of half-hours, demand did not fall below 74 kW. The avoided-import rate on the variable cost components of the supply contract was 19 to 21 p/kWh, below the 24 p/kWh screening benchmark, but now supported by an actual invoice rather than a published forecast. Capacity factor held at 25 to 27 per cent at the 36 m hub height of the reference machine, stable across the range of wind assumptions tested.

Because demand almost never drops below 74 kW, a 100 kW turbine at this site is producing into a load that can absorb it in nearly every half-hour of the year. Export exposure falls to around 3 per cent of generation, which removes the Smart Export Guarantee rate as a meaningful variable in the model.

That single figure is what allows a lower avoided-import rate of 19 to 21 p/kWh to produce a stronger case than the original screening did at 24 p/kWh. The central case gives gross revenue of approximately £46,000 per year and a net annual benefit of £34,000 to £38,000 after operating costs.

With the revenue line settled, the answer turned entirely on capital cost.

Refurbished machines of this size come out of European repowering programmes on a regular basis, typically late 1980s to late 1990s Danish or Dutch plant. The route is credible at farm scale, and Arc set out what accepting it means: availability of 92 to 94 per cent rather than 95 to 97 per cent, a secondary spares chain through European decommissioning yards with longer lead times on non-standard parts, a realistic operating life of 15 to 18 years rather than 20 to 25, and a two-year workmanship warranty from the refurbishment specialist in place of a five-year manufacturer warranty. None of these is a dealbreaker, but they change the risk profile, and the choice of refurbishment specialist matters more than it would on a new-build installation.

The conclusion Arc gave the client was therefore conditional and stated plainly: if new-build is a hard requirement, a 3 to 5 year payback is not achievable at this scale in the UK 2026 market, and it is better to establish that before commissioning further work than after.

Supply-chain context reinforces the point. The 100 kW to 225 kW band has a genuine gap in UK-established new-build product since the Feed-in Tariff closed in March 2019. Of the candidate machines reviewed, one manufacturer entered liquidation in 2019 and its 250 kW model never reached the market, and another remains in production but has no identified UK distributor, UK service capability, or UK reference installations. Arc excluded both from the economics on that basis rather than carry them forward on paper specification alone.

Arc acted as independent feasibility adviser, with no interest in any turbine supplier or installer. The work ran across several strands, each feeding a single answer to a single question.

The client now has a defensible answer to the question actually asked, built on their own meter data rather than sector benchmarks: the target payback is reachable, on one route, with a set of trade-offs set out in full and priced.

Equally useful is the negative finding. Knowing that new-build cannot reach a 3 to 5 year payback at this scale in the current market saves the cost of a study that would have arrived at the same place more slowly. The decision on whether the refurbished route is acceptable in principle sits with the client, and the revised scope study is with them for consideration.

A fifteen-minute call is enough to understand your asset, your objective, and your decision context and to tell you whether Arc can add value in your situation.

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