An Overview of the Technology and Economics of Offshore Wind Farms

1. An Overview of the Technology and Economics of Offshore Wind Farms James F. Manwell, Ph.D.

2. Typical Offshore Windfarm 20, 2 MW Turbines Middelgrunden Wind Farm (off Copenhagen, Denmark) Photo: J. Manwell

3. Excellent wind resource off the coast Wind speeds highest furthest from shore Winds off Massachusetts Map: True Wind Solutions, with support from Mass. Tech. Collaborative, Northeast Utilities, CT Innovations

4. Typical Week of Wind in Nantucket Sound

5. Moderate depths (less than 100’) presently required Shallow water (less than 50’) preferred Water Depth < 120 ft < 90 ft < 60 ft

6. Converts energy in wind to electricity Major components Rotor Hub Blades Gearbox Generator Tower Typical Wind Turbine

7. Multiple wind turbines Bottom mounted foundation Electrical grid between turbines Power cable to shore Infrastructure for operation & maintenance Offshore Wind Farms

8. Conceptual Design of Typical Offshore Wind Plant • Foundation • Bottom mounted up to ~ 60 ft. depth • Floating structure in deep water

9. Conceptual Design of Typical Offshore Wind Plant • Submarine cable to mainland for power and communication

10. Conceptual Design of Typical Offshore Wind Plant • Barge with crane for installation

11. Support Options for Offshore Wind Turbines

12. Electrical Cables Typical cable layout Cable cross section Cable trencher Cable laying ship Illustrations from www.hornsrev.dk

13. Installation Photos: Courtesy GE Wind

14. Total installed costs Turbines, Foundations, Electrical System Installation Energy produced Wind resource Turbine operating characteristics Turbine spacing Operation and Maintenance (O & M) Scheduled maintenance and repairs Financial considerations (interest rates, etc.) Determinants of Cost of Energy

15. Number of turbines Size of turbines Distance from shore Water depth Mean wind speed Turbine reliability and maintainability Site accessibility Factors Affecting Cost of Energy

16. Turbine costs (inc. tower): $800-1000/kW Cable costs: $500k-$1,000,000/mile Foundation costs: Costs depend on soil and depth North Sea: $300-350/kW Price increases ~15%-100% when depth doubles (from 25 ft to 50 ft) Total installed costs: $1200-$2000/kW Typical Offshore Capital Costs

17. Turbine (w/out tower): 17-40% Tower and foundation: 28-34% Electrical grid: 9-36% Other: 6-17% Offshore Capital Cost Breakdown

18. Wind resource Turbine power curve Capacity factor Actual energy/maximum energy Typical values offshore: 35-45% Availability Fraction of time turbine can run Energy Production

19. 1.0 – 2.0 US cents/kWh O & M increases with Increased distance from shore Increased occurrence of bad weather O & M decreases with More reliable turbine design Greater number of turbines Typical O & M Costs

20. Cost of energy (COE), $/kWh, depends on: Installed costs, C Fixed charge rate, FCR – fraction of installed costs paid each year for financing O & M Annual energy production, E COE = (C*FCR+O&M)/E Cost of Energy

21. Simple alternative economic measure Simple payback period (SP), years, depends on: Installed costs, C Annual energy production, E Net price obtained for electricity, P SP = C/(E*P) Simple Payback

22. Bulk energy sold at wholesale Internalized social benefits Wind energy production tax credit (PTC) Renewable energy portfolio standards (RPS) certificates (RECS) Value of Energy

23. Costs not accounted for directly in fuel price or production costs Examples: Air pollution health affects Damage due to global warming Typical estimates: Coal: 2-15 cents/kWh Gas: 1-4 cents/kWh Social (External) Costs of Electricity Production

24. Turbine size: 450 kW-2000 kW Number of turbines: 2-28 Wind speeds: ~7.5 m/s Water depth: 2-10 m Distance from shore: 250 m-3 km Cost of Energy: 5.3- 11.2 cent (EC) /kWh ( ≈ 5.3 – 11.2 US cent/kWh) Actual Costs of Energy, Existing European Projects - 2001

25. 1997 European study: 7.5 MW wind farm, 1.5 MW turbines, 5 km from coast – 4.9 US cent/kWh 30 km from coast – 6.9 US cent/kWh 200 MW wind farm, 1.5 MW turbines, 5 km from coast – 4.1 US cent/kWh 30 km from coast – 4.4 US cent/kWh Costs as a Function of Distance and Total Size

26. Assume Installed cost: $1500/kW Capacity factor: 40% Availability: 95% Value of Energy: 8.3 cents/kWh, based on: Wholesale: 4 cents/kWh PTC: 1.8 cents/kWh RPS: 2.5 cents/kWh Operation & Maintenance: 1.5 cents/kWh Fixed charge rate: 14% Simple payback = 6.6 years COE= 7.8 cents/kWh Sample Economic Assessment

27. Greater energy production More extreme environment Greater cable length Deeper water, larger foundation costs Technology development useful to reduce costs Floating supports for deep water Technical Considerations with Sites Further from Shore

28. Deep Water Possibilities Delft University, 2001 UMass, 1974

29. Offshore wind energy is a reality in shallow water, close to shore Cost of energy higher than from conventional sources, ignoring externalities COE competitive, including RECS and PTC Technology for moderately deep water still expensive Technology for deep water, far from shore remains to be developed Summary