Sunday, February 25, 2024

Wind Farm Repowering: Profitable Via Tech Improvements and Shows that Partial Asset Stranding Can Be a Net Gain with a Good Payout

 

      According to Iberdrola repowering a wind farm “mainly consists of replacing (partially or totally) the old turbines with more powerful and efficient models using the latest technology. Repowering can multiply the generating capacity of a wind farm and significantly increase electricity production. The reason is simple: each new turbine produces more energy than the old ones and therefore fewer units are needed. According to data from EoLIS 2022, WindEurope's annual event, on average, repowering reduces the number of turbines in a wind farm by a quarter, while increasing the installed capacity of the wind farm by a factor of 2.7 and tripling its electricity production.”

     There are several reasons that repowering wind farms have become more profitable including technology and efficiency improvements, turbine size increases, more output per turbine, inefficiency of older wind farms with low-tech turbines deployed in the best wind conditions, electricity demand and prices, and regulatory incentives.

     The benefits of repowering wind farms vary by site and include increased production capacity, efficiency improvements, cost reduction, improved grid integration, preservation of employment, and increasing low-carbon electricity.

     Wind and solar power both have large land footprints and to be able to get more power out of the same amount of land with upgraded and repowered projects is desirable. According to the DOE, this is sort of equivalent to a brownfield/greenfield situation: “Wind repowering enables owners to retrofit power plants on existing sites with new and/or refurbished technology, including erecting taller, more efficient wind turbines to increase productivity. Repowered projects can often gain further cost-saving advantages, relative to new greenfield (or vacant-lot) developments, by using existing grid connections and infrastructure.” They also mention wind-heavy Denmark which has some very old wind projects still producing and who has been repowering those projects with better tech for many years. In 2019 wind repowering in Denmark represented a staggering 86% of gross added capacity and 87% of added wind turbines. From 2012 through 2019 Denmark had a 1.3 GW gain in capacity and a reduction of 109 wind turbines through repowering projects. Other repowering considerations in Europe and everywhere else for that matter include the benefits of reducing noise emissions, better aesthetics, and political considerations.





       

 

Wind Tech Advancements: Bigger is Better and More

 

     Height and turbine size increases have led to wind power efficiency improvements. Specifically, hub height and rotor diameter increases are the big factors in improving efficiency. Hub height refers to the distance from the ground to the hub of the turbine. According to the DOE: “hub height for utility-scale land-based wind turbines has increased 73% since 1998–1999, to about 98 meters (~322 feet) in 2022. That’s taller than the Statue of Liberty! The average hub height for offshore wind turbines in the United States is projected to grow even taller—from 100 meters (330 feet) in 2016 to about 150 meters (500 feet), or about the height of the Washington Monument, in 2035.”

 

Higher towers for wind turbines mean stronger higher altitude winds can be captured. Higher altitude winds have less friction from ground elevation variations, tall trees, and other land obstacles. As the figure below shows, most of the taller wind turbines are deployed in the windy areas of the Midwest and the hilltop elevations of the Northern Appalachian Mountains. Hub heights have increased fairly steadily for over a decade.








     Rotor diameters have also increased steadily through the past decade. According to the DOE: “Back in 2010, no turbines in the United States employed rotors that were 115 meters (380 feet) in diameter or larger. In 2022, the average rotor diameter of newly-installed wind turbines was over 130 meters (~430 feet)—longer than a football field, and almost twice the wingspan of a 747.”  A few days ago, I heard about a planned deployment of a wind turbine with a rotor diameter of around 900 feet. Longer turbine blades can capture more wind at any wind speed, including slower speeds. According to DOE: “Being able to harvest more wind at lower wind speeds can increase the number of areas available for wind development nationwide. Due to this trend, rotor swept areas have grown around 645% since 1998–1999.”






     Two drawbacks of larger turbine blades are transportation and installation challenges. Longer blades and taller tower sections are difficult to transport, especially around turns, under bridges, and highway overpasses. They can also be more difficult to install. These problems are being addressed.

     The largest wind turbine in the world became operational in 2023. It’s an offshore turbine, “the MySE 16-260, built by Mingyang Smart Energy for the China Three Gorges Corporation. It’s now operational and contributing to the power grid in China. Here are some impressive stats about this colossal turbine:

 

Rotor diameter: 260 meters (853 feet)

Swept area: 53,902 square meters (580,196 square feet)

Power output: 16 megawatts

Tower height: 152 meters (499 feet)

Generator weight: 349 metric tons (385 US tons)

Expected annual energy production: Around 66 gigawatt-hours, enough to supply approximately 36,000 homes.

 

 

Wind Repowering Economics

     A new report by Enverus concludes that wind repowering is gaining momentum. With significant cost increases for wind projects due to inflation and the cost of borrowing, more wind repowering projects are seeing better upsides than new builds. Choosing to repower over building new reduces capex and operation and maintenance costs and increases power production. Another advantage of repowering can be the ability to do it while keeping existing premium-priced power purchase agreements (PPAs) that have remaining time on the term of the agreement. Enverus quotes subsidiary Enverus Intelligence Research (EIR) VP Scott Wilmot: “Depending on PPA price, repower economics can be preferable to a new build if a 5% capacity factor gain can be realized. This is a low benchmark to clear given the turbine efficiency gains and degradation we have observed. Projects older than 12 years (pre-2012 vintage) can realize capacity factor gains of 10%-20% through a repower — this makes repowering an easy economic decision,” Wilmot said.

     Enverus also reports that the current repowering capacity at 7GW is about equal to new-build wind projects under construction. They also note that EIR identified 261 potential targets in its database representing almost 21,000 MW. Thus, it appears that wind repowering will continue to compete strongly with new builds. “Wind developers plan to add some 6.5-7.5 GW of energy to the grid through repowering projects in 2024. That means 2024 could tie 2019 for the most repowering projects in a single year.” Another advantage to repowering over new builds is that the interconnections are already there, as are the roads, prepared sites, permitting and regulatory approvals, and some other infrastructure. Wilmot predicts that wind repowering will continue to proliferate in the near to midterm as its economics continue to look better than keeping older underperforming projects online.

     The fact that wind repowering can happen fast, much faster than new builds, and can significantly increase the power output of a wind farm also means that it can quickly increase revenues not just for the developers but also for those who lease the land to them, who will also benefit from longer terms.

 

 

Stranding Some Assets Early Can Be Profitable

 

     Wind repowering is one example that shows that stranding some of these underperforming and inefficient (according to modern standards) projects can be economically wise. This is especially true for renewables that can still receive new production tax credits since they have been extended for another ten years in the U.S. Wind repowering also addresses land scarcity and mostly bypasses public opposition to new projects. These advantages can tip the scales and result in repowering being more economical than keeping older and inefficient projects online. Thus, early retirement of those original assets is a net benefit.  

 

 

References:


The upside of repowering wind: Why developers may blow new life into existing onshore over new builds. Enverus. January 31, 2024. The upside of repowering wind | Enverus

Repowering will represent nearly half of all new wind capacity in 2024: Enverus. Emma Penrod. Utility Dive. February 22, 2024. Repowering will represent nearly half of all new wind capacity in 2024: Enverus | Utility Dive

Repowering of wind farms: Do you know what repowering of wind farms is and how it is carried out? Iberdrola. Repowering of wind farms - Iberdrola

Wind Turbines: the Bigger, the Better. Liz Hartman. U.S. Dept. of Energy. Office of Energy Efficiency & Renewable Energy. August 24, 2023. Wind Turbines: the Bigger, the Better | Department of Energy

The Largest and Most Powerful Wind Turbine Ever Built Is Now Operational. David Nield. Science Alert. July 24, 2023. The Largest And Most Powerful Wind Turbine Ever Built Is Now Operational : ScienceAlert

 Wind Repowering Helps Set the Stage for Energy Transition. U.S. Dept. of Energy. Wind Technologies Office.June 2, 2021. Wind Repowering Helps Set the Stage for Energy Transition | Department of Energy

 Wind repowering: Unveiling a hidden asset. H. Doukas, A. Arsenopoulos, M. Lazoglou, A. Nikas, and A. Flamos. Renewable and Sustainable Energy Reviews. Volume 162, July 2022, 112457. Wind repowering: Unveiling a hidden asset - ScienceDirect

No comments:

Post a Comment

     The San Juan Basin in northwestern New Mexico and southwestern Colorado, which mainly produces natural gas, saw booms and busts in the ...