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By Robert Rapier on Apr 20, 2017 with 3 responses

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.

Link to Original Article: Offshore Wind Power Cost Update

  1. By Joe Clarkson on April 22, 2017 at 2:33 am

    Yes, off-shore wind is expensive and shouldn’t be undertaken until all viable onshore sites are occupied. But note that Kiefer’s reference for 2015 performance data shows that onshore wind is even cheaper than coal and gas, albeit as only energy and no capacity.

    Of course coal and gas pay no penalty for carbon emissions. Should they do so at a reasonable rate, even off-shore wind would be competitive, as would solar. On-shore wind would be the preferred energy source over everything, except perhaps for good hydro projects.

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  2. By fleeb on April 22, 2017 at 4:36 am

    Max water depth 13 ft, one mile off shore.

    GE is currently building 150 meter diameter offshore turbines for Germany. Direct drive simplicity for low maintenance that are rated at 6 MW achieving 40% capacity. Most value the Vindeby project as a success. A learning experience and stepping stone. It surpassed the 25 year design life. The generator was converted to salt water environment per better rotor seals. Doesn’t sound like a particular robust design for low maintenance.

    I’ve read, also, that offshore wind energy is about 2x the cost of land based for all the reasons you post. It’s still is a work in process, so wind energy probably will trend downward for cost in both applications. One development that should be impressive is the new concrete high stress towers. The lower cost and higher stiffness material is expected to increase tower height. I can only think this would be great for offshore power. Maybe a company specialty and business plan to construct offshore concrete stanchions for lease to wind turbine power utilities. The stanchion stays put for extremely long duration with low depreciation expense. Add the gigantic low maintenance wind turbines and the cost may become better than land based. The stanchion can designed as artificial reef or fish crib for ocean life.

    The thing that flipped my thinking on wind and solar is hydrogen production. I was listening to PBS Autoweek update within industry leadership of hydrogen car. It’s real and just starting. While some will prefer the plug in battery car for short trips the hydrogen fuel cell appears to be capable of replacing the ICE. They laid out the technology, cost, benefits, and trends. They made a comment of solar and wind problems go away with hydrogen production. A CHP fuel cell system (Japan) may be the answer for home needs of heat and power. The ratio of power to heat is just about perfect for household needs. Roof top solar may be tapped for hydrogen production as well. REA need may go away as “grid” power is only a concern of heavy users and metro areas that could operate in microgrid power generation and use. The massive central power plant and fragile/expensive grid may become obsolete as a better lower cost system develops.

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  3. By Ulenspiegel on June 19, 2017 at 7:07 am

    The price of 5 USD/W is very high: For German FAR-offshore you find prices in the 3 – 4 EUR/W range, and this with a CF > 40%. (e.g. Fraunhofer Windmonitor, Windenergiereport 2016, p 69).

    And the last auctions indicate that the costs will be decreasing at a very high rate.

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