The Economics of Wind Energy

The Age of Wind Energy, 2019

There is no single answer to the question, "What is the price of wind energy," nor to the question, "Is wind economic?" The answer depends on the local wind regime, the price of competing fuels, and institutional factors. The price of wind-generated electricity needs to be set in context and compared with the prices from other renewable energy sources, and from the thermal sources of electricity generation. With these caveats, 2018 was a turning point for wind energy. Several respected authorities concluded that the price of wind energy was comparable with those of the thermal sources and so wind energy could be viewed as a "mainstream" generation source. This view was underscored by the fact that a number of projects secured contracts in Germany and elsewhere that did not require any subsidies. So, although most wind energy developments still attract financial support-mostly in the form premium payments for the energy, but occasionally in the form of capital subsidies-the gap between the generation costs of wind energy and of electricity from conventional thermal plant has narrowed or disappeared completely. The situation, however, depends on the geographical location. In areas where good wind speeds can be found, wind is likely to be competitive-unless coal or gas is cheap. Exactly what is meant by "good wind speeds" and "cheap coal and gas" is explored later. 16.2 The Cost of Electricity from Wind Energy The majority of energy cost figures in this chapter are quoted in $/MWh and, strictly speaking, are energy prices, inasmuch as they invariably include an element of profit. They are calculated using the "levelised cost concept" which is the "cost of D. Milborrow (*) Consultant, Lewes, East Sussex, UK

2014

Wind power creates jobs The European Wind Energy Association estimates that by 2020 there will be 520,000 jobs in the European wind energy sector and almost 800,000 jobs by 2030. Globally 834,000 people were employed in the wind industry at the end of 2013.-Read more in Chapter 6 and 11 Contents Chapter 1 Preface Chapter 2 Summary and recommendations Chapter 3 Synthesis Chapter 4 Global energy perspectives with an emphasis on wind energy Chapter 5 Danish and European plans for wind energy deployment Chapter 6 Wind energy technology developments Chapter 7 Offshore wind energy developments Chapter 8 Emerging wind energy technologies Chapter 9 Challenges and solutions for energy systems with high shares of wind energy Chapter 10 Wind resource assessment and wind power forecasting Chapter 11 Wind economics Chapter 12 Environmental and social impacts of wind energy Chapter 13 Recycling of wind turbines Chapter 14 Index Chapter 15 References

2015

2020

Fixed feed-in tariffs based on the Renewable Energy Act grant secure revenues from selling electricity for wind turbine operators in Germany. Anyhow, the level of federal financial support is being reduced consecutively. Plant operators must trade self-sufficiently in the future and hence generate revenue by selling electricity directly on electricity markets. Therefore, uncertain future market price developments will influence investment considerations and may lead to stagnation in the expansion of renewable energies. This study estimates future revenue potentials of non-subsidized wind turbines in Germany to reduce this risk. The paper introduces and analyses a forecasting model that generates electricity price time series suited for revenue estimation of wind turbines based on the electricity exchange market. Revenues from the capacity market are neglected. The model is based on openly accessible data and applies a merit-order approach in combination with a simple agent-based approach to forecast long-term day-ahead prices at an hourly resolution. The hourly generation profile of wind turbines can be mapped over several years in conjunction with fluctuations in the electricity price. Levelized revenue of energy is used to assess both dynamic variables (electricity supply and price). The meritorder effect from the expansion of renewables as well as the phasing out of nuclear energy and coal are assessed in a scenario analysis. Based on the assumptions made, the opposing effects could result in a constant average price level for Germany over the next 20 years. The influence of emission prices is considered in a sensitivity analysis and correlates with the share of fossil generation capacities in the generation mix. In a brief case study, it was observed that current average wind turbines are not able to yield financial profit over their lifetime without additional subsidies for the given case. This underlines a need for technical development and new business models like power purchase agreements. The model results can be used for setting and negotiating appropriate terms, such as energy price schedule or penalties for those agreements.

2018

Many countries worldwide support green energy production on large scale mostly by solar or wind energy subsidizing manufacture and operation of such systems. During the last two decades, there has been significant increase in wind energy production globally. Statistics show continuously growing investments in the development and installation of wind turbines and farms. Currently, wind energy is the second most important source of renewable energy after water energy. By 2016 global cumulative installed wind capacity surpassed 432 k MW [GWEC]. In last several years, most dynamic growth in wind power generation investments was recorded in Asia. Europe, in comparison, has less impressive but steady growth in wind power plants through the years. In this article, authors present global demand on energy in comparison to efficiency of wind power plants in relation to the local and global location as well as to the scale of installed system. Authors also present statistical data concerning w...

Proceedings of The IEEE, 2001

More than 70% of the total worldwide electricity-generating wind turbines (17 500 MW total) has been installed in Europe. Of these, 3500 MW were installed in 2000 alone, continuing an impressive pace of development over the last several years. At the same time, the European wind manufacturing industry is booming with two-thirds of the world market share. These remarkable developments are attributed to the effective support of the European Union and of the national European states, following their commitment to reduce greenhouse gas (GHG) emissions. Wind power is now seen as a clean, cost-effective alternative to other forms of conventional electricity production with clear benefits to the environment and to the economy, as a whole. In this review paper, the current state and prospects of wind power in Europe are described, with special emphasis on the three countries leading wind power development in Europe, i.e., Germany, Denmark, and Spain. The investment models applied in Europe play a decisive role in this development. Their differences and effects are shown and the role of renewables in reducing CO 2 (the primary GHG) emissions is highlighted. Finally, current trends and prospects of the European Wind Turbine technology are discussed.