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Wind Energy: Examining the Cost

Willem Post — The Energy Collective — November 29, 2013

Various promoters maintain the cost of wind energy is competitive with other sources of energy. As shown below, this is not the case.

The EIA calculates the levelized cost of NEW onshore wind turbine plants place in service in 2018, capacity factor 0.34, 30-yr life, at $86.6/MWh, including transmission of $3.2/MWh.

NOTE: CFs of 0.34, and greater, are obtainable only in windy areas, such as west of Chicago, and offshore.

http://www.eia.gov/forecasts/aeo/pdf/electricity_generation.pdf 

Assuming a realistic 20-year life of a wind turbine increases the levelized cost to $93/MWh.

After backing out the effect of accelerated depreciation for wind turbine plants, the levelized cost increases to $101/MWh.

Adding the cost of keeping gas or coal plants available in standby mode (in case of too little wind to turn the rotors, i.e., about 7.5 mph), AND in inefficient, part-load-ramping mode (extra Btu/kWh, extra CO2/kWh) to balance the variable wind energy, is $17/MWh for natural gas, $55/MWh for coal.

Extra balancing NG adds $6.00/MWh, extra balancing coal adds $9.00/MWh

Transmission system investments to get wind energy to the grid adds $27/MWh.

Thus, the total levelized cost of wind energy averages $151/MWh with NG back-up/balancing and $192/MWh with coal back-up/balancing.

NOTE: Levelized costs are the net present value of the total cost of new construction (including finance charges during and after construction), maintenance, and operation of a generating plant over its lifetime, expressed in dollars per unit of output, i.e. dollars/MWh. They are used to compare various generating sources to see which sources are the most cost-effective when constructing new plants.

The source of the above data is the American Tradition Institute, The Hidden Costs of Wind Electricity, December 2012,

http://www.atinstitute.org/wp-content/uploads/2012/12/Hidden-Cost.pdf

Grid Level Costs

In Europe, several countries, such as Denmark, Spain, Ireland, Portugal, etc., produced 10 to 20 percent of their energy from wind turbines at least 10 years ago. As these build-outs took place, more became known regarding grid level costs. It appears these grid level costs are significantly greater than claimed by various wind energy promoters.    Continue reading full cost analysis here…..

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