Guest Post: Offshore Wind Power Cost Update

Today I bring you another post from returning guest Todd “Ike” Kiefer who draws some lessons from the decommissioning of the world’s first offshore wind farm. Mr. Kiefer’s biography can be found at the end of the article

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Offshore Wind Power Cost Update

by

Todd “Ike” Kiefer

Decommissioning of world’s first offshore wind farm offers an opportunity to see how industry costs have changed over the past 25 years.

Lifetime Performance of World’s First Offshore Wind Farm

The first offshore windfarm in the world has just been decommissioned and is now being torn down.  Its lifetime performance specs are illuminating in comparison with recent wind industry data, and alternative generation options.

 

1991 Vindeby Offshore Wind Farm – Denmark

Years of Operation:                        1991-2016 (25)

Capital Cost:                                 75M Kroner = $13M (1991USD) = $23M (2017USD)

Number of Turbines:                      11 @ 450 kW

Lifetime Generation:                      243 GWh

Nameplate Capacity:                     4.9 MW

Average Power Output:                 1.1 MW

Nameplate Capacity Cost:            $2.65/Watt (1991USD), $4.70/Watt (2017USD)

Lifetime Capacity Factor:              22%

Effective Capacity Cost:                $12/Watt (1991USD) = $21/Watt (2017USD)

Levelized Capital Cost:                  $53/MWh (1991USD) = $95/MWh (2017USD)

Levelized VOM Cost:                     $65/MWh (2017USD) est. using $130/kw-yr industry figures for 2015

Lower Bound of LCOE:                $160/MWh (2017USD)

 

2015 Industry Performance Data for Offshore Wind

Cost/Nameplate Capacity:            $5/Watt

Initial Capacity Factor:                   40%

Effective Capacity Cost:                $12.5/Watt

O&M Costs:                                   $130/kW-yr

Lower bound of LCOE:                   $150/MWh (2015USD) = $154/MWh (2017USD)

 

Conclusions:

1. While turbines are getting larger, able to operate at lower wind speeds, and improving their capacity factors, the total lifecycle cost per unit of energy provided from offshore wind has not perceptibly decreased from 1991 to 2015.  Higher costs of O&M for larger turbines farther offshore seems to consume savings from higher capacity factors.

2. As it is uncontrollably variable and weather dependent, offshore wind generation remains uncompetitive with gas and coal which are half the cost (~ $70/MWh LCOE) while providing fully dispatchable and weather-independent power that is of much higher value to a power grid.

Biography

Captain Todd “Ike” Kiefer, USN (ret.) is director of government relations and economic development for East Mississippi Electric Power Association and president of North Lauderdale Water Association.  His career in public utilities follows 25 years as a naval officer and aviator.  He has degrees in physics, strategy, and military history, and diverse military experience that spans airborne electronic warfare, nuclear submarines, operational flight test, particle accelerators, Pentagon Joint Staff strategic planning, and war college faculty.  Deployed eight times to the Middle East and Southwest Asia, he spent 22 months on the ground in Iraq and Commanded Al Asad Air Base and Training Squadron NINE.  Author of several published papers on energy and energy security.

April 20th, 2017 by