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Wind Power

Preben Maegaard, Executive Director, Folkecenter for Renewable Energy, Vice President EUROSOLAR

The unexpected reduction in the cost of wind power, which is especially promising compared to other renewables, is discussed.

Wind turbines in different countries are basically available at comparable prices based on normal market conditions, but the trend everywhere is the same - wind energy is getting cheaper. Within the last decade, the cost of wind power has dropped between two and three times, and this trend is expected to continue, with the cost of 1KW installed predicted to drop from 1000 EURO in 1998 to around 500 EURO in 2020. There are various reasons for this. Wind turbines themselves cost less as technology improves and the number being manufactured increases. The newer designs are also more efficient, so more electricity is produced from more cost-effective turbines. The size of wind turbines is also increasing - from around 100 kW in the mid 80's, to around 200 kW in the late 80's, 500 kW in the early 90's, through to 1-2 MW now. 4-5 MW wind turbines can be expected in the future which, for logistical reasons, will mostly be for offshore applications. The industry has been characterised by short development periods of 2-3 years to double individual wind turbine capacity. This has all reduced infrastructure costs, as fewer turbines are needed for the same output.

Wind power development started in the late 70's, and was stimulated in the mid 80's by the Californian market. This collapsed a few years later, to be replaced by strong market development in western Europe, notably in Denmark, Germany and Spain, with these three countries accounting for 80% of the total installed wind power in Europe. These countries are not leaders due to superior wind resources, but due to their market policy of fixed minimum prices, which seems to be sufficient guarantee for investors to move into this new sector. To illustrate the importance of appropriate policies and attitudes to new clean energy solutions, we can compare the situation in different countries. Netherlands (370 MW installed) and UK (350 MW installed), which have bidding systems where electricity is purchased from limited numbers of wind schemes selected on the basis of price competition, have less than one quarter the installed capacity of Denmark (1700 MW). In the month of November 1999, Germany installed as much as half of the total installed capacity in the UK (350 MW), in spite of the fact that Germany has wind resources inferior to the UK.

Some of the lowest prices per kWh are being registered in the UK, with prices down to 0.03 EURO per kWh. However, this is not resulting in any significant electricity market share for wind power. The renewable energy feed-in tariff (REFIT) system applied in Spain, Germany and Denmark is not reflecting actual costs, but guaranteeing minimum prices per kWh. However, it seems obvious that in practice it is the only effective encouragement leading to significant installation of wind power to the extent that it can be taken seriously as a source of supply of electricity. Investors in wind power in the three countries mentioned obtain prices not lower than 0.08 EURO per kWh. New tariff structures for the future, including quota models and green certificates, are being evaluated by national and EU authorities.

The total installed capacity for Europe is expected to reach 220 000 MW by 2020. Other prominent countries include the USA and India. The United States has a total installed capacity of 2500 MW, which is expected to rise to 250 000 MW by 2020. India experienced growth during the 90's, but this has now stagnated and it is difficult to predict the future development.

Due to the large available global resources (estimated at 53 000TWh), we can expect a steady growth in wind power, which will increasingly move to off-shore sites in order to make use of higher average wind speeds, especially around densely populated areas.

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