Scottish wind farms handed £1.3m annual discount while southern power plants to pay more Wind farms and other power plants closer to big population centres currently pay much lower charges, and in some cases receive payment as a reward for their efficient location. A similar-sized wind farm in south west England will lose out on £500,000 a year, as its current rebate of £3.94/KW is replaced with a 75p/KW charge - still much lower than its more remote counterparts. The overhaul will also affect gas and nuclear plants, which are not intermittent. Costs of about £25/KW for such so-called 'baseload' plants in northern Scotland would be cut to less than £19/KW, while a gas plant in the Midlands would see costs increase from £1.96/KW to £3.41/KW. The complex way the costs are paid for means that while Scottish power plants benefit the most, consumers in Scotland will actually face a slight increase in their bills. Consumers in the south, who currently pay more, will receive a slight reduction, but will still face the highest charges overall. Ofgem said: "The aim of this change is to facilitate the timely move to a low carbon energy sector, while maintaining a robust and efficient supply of electricity across Britain's high voltage network. The main update to the methodology is that it would better take into account the type of generator and how it uses the network to transmit power to parts of the network where the demand for that power is situated. In doing this, Ofgem considers that the proposed methodology change would better reflect the costs placed on the high voltage system by all forms of generation, including new kinds of generators, located at different points on the network. This proposal will narrow the difference in generation tariffs between the north and south of Britain. Tariffs in the north will decrease whilst tariffs in the south will increase relative to the status quo. Dr Doug Parr, chief scientist at environmental group Greenpeace, said: "Ofgem's decision to revalue the cost that energy producers have to pay to deliver their power to the national grid is great news for the renewable sector that will particularly help wind generators in Scotland. This decision is in line with what many of us have been asking for, the need for a strategic long term plan for the energy industry. As a result not only will this make wind even more viable as an energy source, but help consumers and the planet too. But Dr John Constable, director of REF, a UK charity critical of the costs of renewables subsidies, said: "This market distortion creates an 'avoided-cost' subsidy for generators in remote locations, and penalises generators closer to centres of demand. Consequently, it creates a perverse incentive for developers to seek out locations where it is expensive to connect to the grid. This is counter-economic and dreadful news for the consumer. Whose side is Ofgem on?