The Government has revealed that new onshore wind farms will now be excluded from the Renewables Obligation subsidy scheme from 1 April 2016, a year earlier than expected.
Energy Secretary Amber Rudd said this would mean 250 projects totalling 2,500 planned turbines were now unlikely to be built.
The decision is a blow to civil engineering contractors and mobile crane operators, which have counted on a steady stream of projects coming forward.
More than two-third of these projects were due to be built in Scotland, which has counted on developing a flourishing wind energy industry.
Rudd said: “Onshore wind is an important part of our current and future low-carbon energy mix.
“But we are reaching the limits of what is affordable, and what the public is prepared to accept.”
In 2014, onshore wind made up around 5% of electricity generation, supported by around £800m of subsidies.
At the end of April 2015, there were 490 operational onshore wind farms in the UK, comprising 4,751 turbines in total.
These wind farms have an installed capacity of 8.3GW enough to power the equivalent of over 4.5m homes.
She added: “The Electricity Market Reform Delivery Plan projects that we require between 11-13 GW of electricity to be provided by onshore wind by 2020 to meet our 2020 renewable electricity generation objective while remaining within the limits of what is affordable.
“We now have enough onshore wind in the pipeline, including projects that have planning permission, to meet this requirement comfortably.
“We could end up with more onshore wind projects than we can afford – which would lead to either higher bills for consumers, or other renewable technologies, such as offshore wind, losing out on support.”