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Cost of Wind Energy by S. Tegen, M. Hand, B. Maples, E. Lantz, P. Schwabe and A. Smith
In 2010, wind vitality generated greater than 2% of U.S. electrical energy, with some states producing greater than 10% of their energy from wind. The USA put in 5,116 megawatts (MW) of wind (American Wind Energy Affiliation, AWEA 2011), which was one-quarter of all new electrical capability additions for that 12 months.
Wind vitality capability additions trailed the 6,000 MW of new coal and 7,200 MW of new pure gasoline additions in 2010 (Wiser and Bolinger 2011). With at this time’s financial downturn, decision-makers are weighing the prices of totally different electricgeneration sources with cautious scrutiny.
It’s vital that we perceive what these prices embrace and don’t embrace when evaluating applied sciences, analyzing the prices of wind vitality over time, and searching for cost-improvement alternatives. This report presents the most effective accessible info on the price of wind vitality in 2010, together with a abstract of historic tendencies and future projections.
One method to categorical the price of wind vitality is to calculate the levelized value of vitality (LCOE). The LCOE is a metric that has been used by the U.S. Division of Energy (DOE) for a few years to judge the life-cycle prices of technology for vitality initiatives and the entire system affect of expertise design modifications.
The LCOE equation used by NREL for this report is a regular technique used to match vitality applied sciences (Quick et al. 1995, EPRI 2007); it’s described intimately beneath. There are 4 primary inputs to any LCOE equation: put in capital value, annual working bills, annual vitality manufacturing, and glued cost charge (an annualized presentation of the price of financing a wind venture).
This report gives context for every of the 4 main elements and describes the LCOE equation intimately in addition to the methodology, assumptions, and present market circumstances for utility-scale land-based and offshore wind. NREL used a spread of sources together with business information and mannequin projections to reach at the most effective consultant information for U.S. wind initiatives in 2010.
The modeled outcomes offered on this doc are based mostly on the NREL Wind Turbine Design Cost and Scaling Mannequin (Cost and Scaling Mannequin) developed in 2006 (Fingersh et al. 2006). This value of vitality evaluation summarizes the most recent enter assumptions for the Cost and Scaling Mannequin in addition to two of the outputs used by NREL: annual vitality manufacturing and element capital prices.
Though the LCOE will be calculated in a spread of methods, this report presents just one of them. This report gives details about every component utilized in typical LCOE calculations, and the person elements can be utilized in different LCOE equations.
The LCOE estimates on this report don’t embrace costs to customers (that are influenced by insurance policies and different incentives e.g., manufacturing tax credit score), transmission, integration, or potential revenues designed to mirror the price of producing vitality. The estimates are designed to mirror a typical U.S. wind plant.
For every variable represented in our 2010 LCOE equations, there’s a vary of potential values. Determine 1 exhibits the baseline assumptions and ranges of prices for the totally different parameters of LCOE that we used for land-based wind, and Determine 2 exhibits the assumptions and prices for offshore wind.
The important thing parameters embrace: put in capital value (ICC), annual working bills (AOE), capability issue, low cost charge, and operational life of the venture. For instance, the capability elements vary from 25% to 45%, with an assumed 38% for our baseline generators.
Every of these ranges and assumptions are proven in Determine 1. Land-based wind assumptions and sensitivities for key LCOE enter parameters are defined of their corresponding part within the paper.
Observe that the LCOE ranges for land-based and offshore are totally different (and have totally different axes in these figures). For offshore wind, capability issue ranges from 30% to 45% with an assumption of 39% for the baseline or reference turbine.
As proven, there’s a very big selection of put in capital value for offshore wind initiatives. That is mentioned additional within the offshore wind capital value part.
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