Government plans to create a million “green collar” jobs were dealt a fresh blow yesterday after one of the world’s largest manufacturers of wind turbines announced plans to cut 600 jobs in Britain.

Vestas, the Danish company that supplies 20 per cent of the global wind turbine market, said that it was cutting a total of 1,900 jobs in Denmark and at its blade manufacturing and research plant at Newport on the Isle of Wight. The company cited sluggish demand for turbines in the UK and elsewhere in Northern Europe, in contrast to booming wind energy sales in China and the United States.

The Isle of Wight factory employs 618 people directly and supports other jobs through suppliers. “Capacity will be reduced in Northern Europe, as demand in this area at the moment does not meet expectations,” the company said. “Consequently, Vestas expects to lay off approximately 1,900 employees in the production units in Northern Europe.”

Vestas has a global workforce of 21,000, including more than 5,500 people hired worldwide last year. The cuts come in spite of a robust financial performance. The company said that net profit in the first three months of the year had risen by 70 per cent to €56 million (£50 million), from €33 million in the same period last year. Sales increased to €1.1 billion, from €701 million a year ago.

Vestas said that it had delivered a total of 490 wind turbines to customers during the first quarter, up 21 per cent from the same period in 2008.

The UK ranks close to the bottom of the European league table for the proportion of electricity generated from renewable energy, above only Luxembourg and Malta. Renewables supply about 5 per cent of UK electricity and 1.3 per cent of total energy.

New targets set in Europe and backed by Britain demand that 15 per cent of all UK energy comes from renewable sources by 2020. This equates to between 30 per cent to 45 per cent of British electricity coming from renewables in the next 11 years, a sixfold-to-ninefold increase from present levels.

The announcement from Vestas comes less than a week after the Government unveiled in the Budget a package of measures designed to support the industry.

“Over 600 people at this wind turbine manufacturer could lose their jobs because the Government has failed to remove the obstacles blocking faster wind farm development,” Robin Oakley, head of Greenpeace’s energy campaign, said. “This lack of support is now all too apparent as hundreds of British workers face redundancy.”

Greg Clark, the Shadow Energy and Climate Change Secretary, said: “These job losses are very sad news for Vestas workers and their families. The Government has been told for months that many of these wind projects are in jeopardy but have waited far too long to act.

“Britain has the best offshore wind, wave and tidal resources in Europe and yet still produces less of its energy from renewable sources than almost any other major European country.”

“It’s clear that Vestas recognises the potential of the UK wind market,” Mike O’Brien, Minister of Energy and Climate Change, said. “Measures set out in the Budget will offer renewed support to the wind industry and help to move potential projects towards construction, which could mean more business for Vestas. These measures have been welcomed by the renewables industry.

“Regrettably, some people face possible redundancy and the Government will be offering support to those affected. However, Vestas have indicated that the steps we have taken will have a positive influence on the possibility of them producing blades in the UK. We will continue to work with the company to help this happen.”

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