Hazel Renewable Energy will halve the value of part of its small wind portfolio due to quality and technical issues with Chinese-made turbines.
Posting full year results for both of its £31.4m venture capital trusts, the firm said its small wind portfolio accounts for around 10% of its total portfolio.
Around a third of the small wind portfolio “consists of Chinese-made Huaying HY-5 wind turbines, some of which experienced significant technical and safety issues during the high wind conditions that prevailed in February”, according to the Trust’s investment adviser, Gresham House Asset Management.
The company said O&M contractor Britwind has stated it will no longer be able to maintain the assets “due to the poor technical quality of the turbines and lack of support from the manufacturer, which invalidated our insurance coverage. This combined with the safety/public liability implications forced us to put the turbines on mechanical break”.
The company also bemoaned the difficulty in finding experienced maintenance contractors that can “perform a decent quality service at a cost level that makes sense”.
While it has found an engineering firm to assess which turbines are safe and put back into operation those that are unlikely to need major repairs, the firm said it has recommended that the affected element of the portfolio is valued at half the original amount.
Elsewhere, the company said higher inflation would lead to increased revenues from index-linked subsidies when tariff adjustments become effective in April, but that lower than average solar irradiation levels had hit revenues across the sector.