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Wind Energy

ANKUR VERMA
ARVINDERPAL SINGH

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Ancient Resource Meets 21st
Century

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Wind Turbines

Power for a House or City

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Wind Energy Outline
 History and Context
 Advantages
 Design
 Siting
 Disadvantages
 Economics
 Future

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History and Context

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Wind Energy History
 1 A.D.
 Hero of Alexandria uses a wind machine to
power an organ
 ~ 400 A.D.
 Wind driven Buddhist prayer wheels
 1200 to 1850
 Golden era of windmills in western
Europe – 50,000
 9,000 in Holland; 10,000 in England;
18,000 in Germany
 1850’s
 Multiblade turbines for water pumping made and marketed in
U.S.
 1882
 Thomas Edison commissions first commercial electric
generating stations in NYC and London
 1900
 Competition from alternative energy sources reduces windmill
population to fewer than 10,000
 1850 – 1930
 Heyday of the small multiblade turbines in the US midwest
 As many as 6,000,000 units installed

 1930+
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 Grid electricity rapidly displaces multiblade turbine uses
Increasingly Significant
Power Source

Wind
could
generate
6% of
nation’s
Wind currently produces less
than 1% of the nation’s
electricity
power. by 2020.
Source: Energy Information Agency

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8
Manufacturing Market Share

Source: American Wind Energy Association 9


US Wind Energy Capacity

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Wind Power
Advantages

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Advantages of Wind Power
 Environmental
 Economic Development
 Fuel Diversity & Conservation
 Cost Stability

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Environmental Benefits
 No air pollution
 No greenhouse gasses
 Does not pollute water with mercury
 No water needed for operations

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Pollution from Electric
Power

Sulfur Dioxide 70%


Carbon Dioxide 34%

Nitrous Oxides 33%


Particulate Matter 28%
Toxic Heavy Metals 23%

0% 20% 40% 60% 80%


Percentage of U.S. Emissions

Source: Northwest Foundation,


12/97
Electric power is a primary source of industrial air pollution
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Economic Development
Benefits
 Expanding Wind Power development
brings jobs to rural communities
 Increased tax revenue
 Purchase of goods & services

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Economic Development
Example

Case Study: Lake Benton,


MN
$2,000 per 750-kW turbine in
revenue to farmers
Up to 150 construction, 28
ongoing O&M jobs
Added $700,000 to local tax
base

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Fuel Diversity Benefits
 Domestic energy source
 Inexhaustible supply
 Small, dispersed design
 reduces supply risk

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Cost Stability Benefits
 Flat-rate pricing
 hedge against fuel price volatility risk
 Wind electricity is inflation-proof

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Wind Power
Design

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Power in the Wind (W/m2)

= 1/2 x air density x swept rotor area x (wind speed)3


ρ A V3

Density = P/(RxT)
P - pressure (Pa)
R - specific gas constant (287 J/kgK) Area = π r2 Instantaneous Speed
T - air temperature (K) (not mean speed)
kg/m3 m2 m/s

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Wind Energy Natural
Characteristics
 Wind Speed
 Wind energy increases with the cube of the wind speed
 10% increase in wind speed translates into 30% more
electricity
 2X the wind speed translates into 8X the electricity

 Height
 Wind energy increases with height to the 1/7 power
 2X the height translates into 10.4% more electricity

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Wind Energy Natural
Characteristics
 Air density
 Wind energy increases proportionally with air density
 Humid climates have greater air density than dry climates
 Lower elevations have greater air density than higher elevations
 Wind energy in Denver about 6% less than at sea level

 Blade swept area


 Wind energy increases proportionally with swept area of the blades
 Blades are shaped like airplane wings
 10% increase in swept diameter translates into 21% greater swept area
 Longest blades up to 413 feet in diameter
 Resulting in 600 foot total height

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How Big is a 2.0 MW Wind
Turbine?
80

59.6

This picture shows a


Vestas V-80 2.0-MW
wind turbine
superimposed on a
Boeing 747 JUMBO JET

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Recent Capacity
Enhancements
2006
5 MW
600’

2003
1.8 MW
2000 350’
850 kW
265’

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Nacelle Components 10

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17
12
12
1. Hub controller 11. Blade bearing
2. Pitch cylinder 12. Blade
3. Main shaft 13. Rotor lock system
4. Oil cooler 14. Hydraulic unit
5. Gearbox 15. Machine foundation
6. Top Controller 16. Yaw gears
7. Parking Break 17. Generator
8. Service crane 18. Ultra-sonic sensors
9. Transformer 19. Meteorological gauges 25

10. Blade Hub


Turbines Constantly
Improving
 Larger turbines
 Specialized blade design
 Power electronics
 Computer modeling
 produces more efficient design
 Manufacturing improvements

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Improving Reliability
 Drastic improvements since mid-80’s
 Manufacturers report availability data of
over 95%

100
% Available

80
60
40
20
0
1981 '83 '85 '90 '98 Year
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Wind Project
Siting
DECIDING PARAMETERS FOR WIND POWER PROJECT

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Siting a Wind Farm
 Winds
 Minimum class 4 desired for utility-scale wind farm (>7
m/s at hub height)
 Transmission
 Distance, voltage excess capacity
 Permit approval
 Land-use compatibility
 Public acceptance
 Visual, noise, and bird impacts are biggest concern
 Land area
 Economies of scale in construction
 Number of landowners

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Wind
Disadvantages

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Market Barriers
 Siting
 Avian
 Noise
 Aesthetics
 Intermittent source of power
 Transmission constraints
 Operational characteristics different from
conventional fuel sources
 Financing

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Wind Energy and the Grid
 Pros
 Small project size
 Short/flexible development time
 Dispatchability
 Cons
 Generally remote location
 Grid connectivity -- lack of transmission capability
 Intermittent output
 Only When the wind blows (night? Day?)
 Low capacity factor
 Predicting the wind -- we’re getting better 32
Birds - A Serious Obstacle

 Birds of Prey (hawks, owls, golden eagles) in jeopardy


 Altamont Pass – News Update – from Sept 22
 shut down all the turbines for at least two months each winter
 eliminate the 100 most lethal turbines
 Replace all before permits expire in 13 years

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Wind – Characteristics &
Consequences
 Remote location and low capacity factor
 Higher transmission investment per unit output
 Small project size and quick development
time
 Planning mismatch with transmission investment
 Intermittent output
 Higher system operating costs if systems and
protocols not designed properly

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Wind Economics

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Wind Farm Design
Economics
 Key Design Parameters
 Mean wind speed at hub height
 Capacity factor
 Start with 100%
 Subtract time when wind speed less than optimum

 Subtract time due to scheduled maintenance

 Subtract time due to unscheduled maintenance

 Subtract production losses

 Dirty blades, shut down due to high winds


 Typically 33% at a Class 4 wind site

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Wind Farm Financing
 Financing Terms
 Interest rate
 LIBOR + 150 basis points
 Loan term
 Up to 15 years

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Cost of Energy Components
 Cost (`/kWh) =
(Capital Recovery Cost + O&M) / kWh/year
 Capital Recovery = Debt and Equity Cost
 O&M Cost = Turbine design, operating
environment
 kWh/year = Wind Resource

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Costs Nosedive  Wind’s
Success

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$0.40 cents/kWh
$0.30

$0.20

$0.10 3.5-5.0 cents/kWh

$0.00
1980 1984 1988 1991 1995 2000 2005

Levelized cost at good wind sites in nominal


dollars, not including tax credit

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Construction Cost Elements
Design &
Financing & Legal Engineering
Fees 2%
3% Land
Development Transportation
Activity 2%
4%
Interconnect/
Subsation Turbines, FOB
4% USA
49%
Interest During
Construction
4%
Towers
(tubular steel)
10%
Construction
22%

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Wind Farm Cost
Components

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Wind Farm Economics
 Capacity factor
 Start with 100%
 Subtract time when wind speed < optimum
 Subtract time due to scheduled maintenance
 Subtract time due to unscheduled maintenance
 Subtract production losses
 Dirty blades, shut down due to high winds
 Typically 33% at a Class 4 wind site

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Wind Farm
Development

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Wind Farm Development
 Key parameters
 Wind resource
 Zoning/Public Approval/Land Lease
 Power purchase agreements
 Connectivity to the grid
 Financing
 Tax incentives

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Wind Farm Development
 Wind resource
 Absolutely vital to determine finances
 Wind is the fuel
 Requires historical wind data
 Daily and hourly detail
 Install metrological towers
 Preferably at projected turbine hub height
 Multiple towers across proposed site

 Multiyear data reduces financial risk


 Correlate long term offsite data to support short term
onsite data
 Local NWS metrological station

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Wind Farm Development
 Zoning/Public Approval/Land Lease
 Obtain local and state governmental approvals
 Often includes Environmental Impact Studies
 Impact to wetlands, birds (especially raptors)
 NIMBY component
 View sheds
 Negotiate lease arrangements with ranchers,
farmers, Native American tribes, etc.
 Annual payments per turbine or production based

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Wind Farm Development
 Connectivity to the grid
 Obtain approvals to tie to the grid
 Obtain from grid operators – WAPA, BPA, California
ISO
 Power fluctuations stress the grid
 Especially since the grid is operating near max
capacity

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Wind Farm Development
 Financing
 Once all components are settled…
 Wind resource
 Zoning/Public Approval/Land Lease

 Power Purchase Agreements (PPA)

 Connectivity to the grid

 Turbine procurement

 Construction costs

 …Take the deal to get financed

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Financing Revenue
Components

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Source: Hogan & Hartson, LLP


Future Trends

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Future Cost Reductions
 Financing Strategies
 Manufacturing
Economy of Scale
 Better Sites and
“Tuning” Turbines for
Site Conditions
 Technology
Improvements

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Future Tech Developments
 Application Specific Turbines
 Offshore
 Limited land/resource areas
 Transportation or construction limitations
 Low wind resource
 Cold climates

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The Future of Wind -
Offshore
•1.5 - 6 MW per turbine
•60-120 m hub height
•5 km from shore, 30 m
deep ideal
•Gravity foundation, pole, or
tripod formation
•Shaft can act as artificial
reef
•Drawbacks- T&D losses
(underground cables lead to
shore) and visual eye sore

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Wind Energy Challenges
 Best wind sites distant from
 population centers
 major grid connections
 Wind variability
 Can mitigate if forecasting improves
 Non-firm power
 Debate on how much backup generation is required
 NIMBY component
 Cape Wind project met with strong resistance by Cape
Cod residents
 Limited offshore sites
 Sea floor drops off rapidly on east and west coasts
 North Sea essentially a large lake
 Intermittent federal tax incentives
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GE WIND ENERGY

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THANK
YOU
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