wind plant cost of energy: past and futurenrel/pr-6a20-57841; january 2013; wind plant; cost of...
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NREL is a national laboratory of the U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy, operated by the Alliance for Sustainable Energy, LLC.
Wind Plant Cost of Energy: Past and Future
Maureen Hand, Ph.D.
2nd NREL Wind Energy System Engineering Workshop
Broomfield, CO
January 2930, 2013
NREL/PR‐6A20‐57841
2
Overview
• Historical trend for wind plant levelized cost of energy (LCOE) including influence of turbine pricing fluctuation and introduction of low wind speed turbine technology
• Projections for future wind plant LCOE based on learning curve, expert elicitation, and engineering‐based modeling.
3
Wind Plant LCOE Declined by More Than 2/3 Between the Early 1980s and 2000s
$0
$50
$100
$150
$200
$250
$300
1980 1985 1990 1995 2000 2005 2010
Levelized
Cost o
f Ene
rgy
(2010 USD
/MWh)
US (LBNL/NREL Internal Analysis)
Denmark (DEA 1999)
Coastal European Sites (Lemming et al. 2009)
Source: Lantz et al. 2012
Escalation in wind power capital costs since 2003 resulted from: • Rising commodity and raw material prices• Increased labor costs • Improved manufacturer profitability• Turbine upscaling.
4
Lower Turbine Prices Since 2009 Along With Improved Wind Turbine Performance May Yield a Return to Historically Low LCOE Levels in 20122013
$50
$70
$90
$110
$130
$150
$170
5.5 6 6.5 7 7.5 8 8.5
Levelized
Cost o
f Ene
rgy in th
e United States
(2010 USD
/MWh)
50 Meter Wind Speed (m/s)air density = 1.225 kg/m3
Class 2 Class 3 Class 4 Class 5 Class 6
Estimated LCOE: 2002‐03
Estimated LCOE:2009‐10
Estimated LCOE: 2012‐13
Source: Lantz et al. 2012
• Estimated wind plant LCOE based on observed market variation in capital investment and modeled wind plant performance
• Incentives or policies that reduce price of wind energy in wholesale power markets (e.g., production tax credit) excluded.
5
New Technology Options Reduce Variability in LCOE Across a Range of Wind Resource Sites
Source: Lantz et al. 2012
$44/MWh
$25/MWh
8 m/s
7 m/s
6 m/s
$0
$20
$40
$60
$80
$100
$120
2002‐03 Current, 2012‐13
Standard Technology Technology Choice
Levelized
Cost o
f Ene
rgy ($/M
Wh)
No Incentives
• Low wind speed technology designed for International Electrotechnical Commission Class III sites provides Technology Choice in 20122013 for annual average sea level equivalent wind speeds at 50 meters.
6
Most Projections for Wind Plant LCOE Anticipate Future Reductions With Opportunities for Greater Reductions in Offshore Wind Plant LCOE
Land‐Based Wind LCOE Offshore Wind LCOE
Source: Tegen et al. 2012
• Projections included here were published and derived from a variety of methods including learning curves, expert elicitation, and engineering‐based models.
7
Demonstrating Future Cost Reduction of Wind Energy is Important for Understanding Future Electric Sector Evolution
• Renewable Electricity (RE) Futures showed that the incremental cost of high RE scenarios is comparable to published cost estimates of other clean energy scenarios
• Improvement in the cost and performance of renewable technologies is the most impactful lever for reducing this incremental cost.
8
Learning Curves Capture Industry‐Level Advances but Do Not Provide Insight Into the Role of Technology Research and Development Specifically
Source: IPCC 2011
• Describe cost reduction potential as a function of cumulative experience related to cumulative installed capacity
• Do not attempt to identify specific factors that yield cost reductions• Represent learning by research and development (R&D), learning by experience, learning
by deployment, learning by doing, and so on.
9
Expert Elicitation Can Represent Deep Knowledge and Experience but Is Difficult to Translate Into LCOE
• Survey industry experts for a range of possible technology outcomes to achieve future cost reductions
• Develop probability distributions associated with various technical outcomes to represent the likelihood of successful innovations
• Difficult to capture interactions between component innovations that impact system LCOE.
Turbine Capital Cost
O&M Costs
Levelized Replacement Cost
Balance of Station Cost
Site-Specific Design/Reduced Design Margin TIOs
Advanced (Enlarged) Rotor TIOs
Reduced Energy Losses and Increased Availability TIOs
Advanced Tower TIOs
Manufacturing TIOs
New Drive Train Concept TIOs
Advanced Power Electronics TIOs
Learning Curve Effects
+10 +20 +30-30 -20 -10 +40% Change
+10 +20 +30-30 -20 -10 +40% Change
TIOs’ Potential for Improvement (% change from reference turbine)
Annual Energy Production
Source: Cohen et al. 2008
10
GoverningSoftware
(OpenMDAO)
Analysis Software (i.e., OpenMDAO, DAKOTA)
User Inputs:Analysis Type and Structure, Fixed Parameter Input Conditions,
Design Variables, Constraints
Turbine Structure and Cost Assembly
Rotor Structure
Drivetrain Structure
Tower & Substructure
Balance of Plant
Component
BOP Model
O&M Component
O&M Model
Wind Plant COE
Inputs
Cost and Sizing ToolWind Plant Analysis ToolOutputs
Energy Production Assembly
Rotor Aerodynamics
Drivetrain Efficiency
Site AEP Model
Finance ComponentFinance Model
Component MassesComponent Costs
Turbine Capital Costs
AEP BOP Costs
O&M Costs
Engineering‐Based Modeling and Analysis Can Capture Interactions Between Components to Quantify the Impact of Specific Technology Innovations on LCOE at the System Level
Source: NREL
11
Conclusions
• Wind energy LCOE has decreased since the 1980s and is likely to continue this downward trend
• Projections for future cost of wind energy with greater precision in magnitude and likelihood will influence electric‐sector evolution scenarios
• Engineering‐based models provide the opportunity to quantify the impact of innovative concepts on wind plant system LCOE.
12
References
• Cohen, J.; Schweizer, T.; Laxson, A.; Butterfield, S.; Schreck, S.; Fingersh, L.; Veers, P.; Ashwill, T. (2008). Technology Improvement Opportunities for Low Wind Speed Turbines and Implications for Cost of Energy Reduction: July 9, 2005July 8, 2006. 37 pp.; NREL Report No. TP‐500‐41036.
• Hand, M.M.; Baldwin, S.; DeMeo, E.; Reilly, J.M.; Mai, T.; Arent, D.; Porro, G.; Meshek, M.; Sandor, D. (2012). Renewable Electricity Futures Study (Entire Report). National Renewable Energy Laboratory. Eds. 4 vols. NREL/TP‐6A20‐52409. Golden, CO: National Renewable Energy Laboratory.
• IPCC. (2011). Summary for Policymakers. IPCC Special Report on Renewable Energy Sources and Climate Change Mitigation [O. Edenhofer, R.; Pichs‐Madruga, Y.; Sokona, K.; Seyboth, P.; Matschoss, S.; Kadner, T.; Zwickel, P.; Eickemeier, G. Hansen; S. Schlomer; C. von Stechow (eds)], Cambridge University Press, Cambridge, United Kingdom and New York, NY, USA.
• Lantz, E.; Wiser, R.; Hand, M. (2012). IEA Wind Task 26: The Past and Future Cost of Wind Energy, Work Package 2. 137 pp.; NREL Report No. TP‐6A20‐53510.
• Tegen, S.; Hand, M.; Maples, B.; Lantz, E.; Schwabe, P.; Smith, A. (2012). 2010 Cost of Wind Energy Review. 111 pp.; NREL Report No. TP‐5000‐52920.
