Renewable energy cost modeling database provide a great way to understand the cost implications of the offshore wind farm projects. Based on a component cost projection technique through the determination of curves based on the variables that most significantly influence the cost-capacity relationship, this generates multiple parameters where specifications of great importance are also defined, such as losses electricity and energy efficiency among others.
The general scheme of the database with a complete exposition of the variables involved and their cost implications, generates projections to estimate the different components, including projections of operating and maintenance costs.
Wind Turbine Systems1
A wind energy conversion system (WECS) is composed of blades, an electric generator, a power electronic converter, and a control system, as shown in the figure shown below The WECS can be classified in different types, but the functional objective of these systems is the same: converting the wind kinetic energy into electric power and injecting this electric power into the electrical load or the utility grid.
History of using wind energy in generating electricity
History of wind energy usage for the generation of electricity dates back to the 19th century, but at that time the low price of fossil fuels made wind energy economically unattractive.1 The research on modernWind Energy Conversion Systems (WECS) was put into action again in 1973 because of the oil crisis. Earlier research was on making high power modern wind turbines, which need enormous electrical generators.
At that time, because of technical problems and high cost of manufacturing, making huge turbines was hindered. So research on the wind turbine turned to making low-price turbines, which composed of a small turbine, an induction generator, a gearbox and a mechanical simple control method. The turbines had ratings of at least several tens of kilowatts, with three fixed blades. In this kind of system, the shaft of the turbine rotates at a constant speed. The asynchronous generator is a proper choice for this system. These low-cost and small-sized components made the price reasonable even for individuals to purchase. As a result of successful research on wind energy conversion systems, a new eneration of wind energy systems was developed on a larger scale. During the last two decades, as the industry gained experience, the production of wind turbines has grown in size and power rating. It means that the rotor diameter, generator rating, and tower height have all increased. During the early 1980s, wind turbines with rotor spans of about 10 to 15 meters, and generators rated at 10 to 65kW, were installed. By the mid-to late 1980s, turbines began appearing with rotor diameters of about 15 to 25 meters and generators rated up to 200kW. Today, wind energy developers are installing turbines rated at 200kW to 2MW with rotor spans of about 47 to 80 meters. According to the AmericanWind Energy Association (AWEA), today’s large wind turbines produce as much as 120 times more electricity than early turbine designs, with Operation and Maintenance (O&M) costs only modestly higher, thus dramatically cutting O&M costs per kWh. Large turbines do not turn as fast, and produce less noise in comparison to small wind turbines.
Offshore Wind turbine technology advances
Offshore Wind turbine foundation technology types
Design
Examples
Pros
Cons
- Greater Gabard (UK)
- Egmond ann Zee (NL)
- Simple design
- Extended offshore tower
- Diameter increases significantly with depth
- Drilling difficulties
- Nysted (DK)
- Thornton Bank (BEL)
- Cheap
- No drilling required
- Seabed preparation required
- Borkum West (DE)
- More stability than basic monopile
- More complex installation
- Bard Offshore 1 (DE)
- Can be installed by traditional jack-up barge
- Piles can be built at any dock or steel mill
- Cost
- Beatrice (UK)
- Stability
- Relatively light
- Cost
- None (Although used in oil & gas)
- Allows deep water use
- Uses less steel
- Cost
COURTESY OF WELT Documentary
Reference from: A parametric whole life cost model for offshore wind farms, Mahmood Shafiee, Feargal Brennan1 & Inés Armada Espinosa - Springer-Verlag Berlin Heidelberg 2016
CAPEX
OPEX / ABEX
OFFSHORE WIND-FARM CAPITAL EXPENDITURE - CAPEX - ESTIMATION MODEL (CLASS 5-4)
Based on the extensive literature and bechmarkings, the cost drivers of offshore wind projects mainly fall into five categories:
- Pre-development and consenting (P&C),
- Production and acquisition (P&A),
- Installation and commissioning (I&C),
- Operation and maintenance (O&M) and
- Decommissioning and disposal (D&D) .
These cost categories are then subdivided into their constituent elements, and a database is built for each cost element.
The development of an offshore wind farm normally begins around 5 years before the time when the installation is executed. From the first idea to the start of the project, many procedures, studies and paperwork must be accomplished to ensure the technical/economical feasibility.
These costs are related to:
- Project management (CprojM),
- Legal authorization (Clegal),
- The conducted surveys (Csurveys),
- Engineering activities (Ceng) and
- Contingencies (Ccontingency).
Thus,
CP&C = CprojM + Clegal + Csurveys + Ceng + Ccontingency
The project management tasks include all administrative services, pre-feasibility studies, financing, tendering process, internal controlling systems, and negotiating with subcontractors.
The total cost of project management is usually expressed as a percentage of the CAPEX. According to Offshore Design Engineering Ltd. (2007), this percentage is estimated to be around the output of the formula shown below in %, i.e.
CprojM = %projM x (CAPEX)
Where:
%projM = 0.0327 x [(P&A)+(I&C)]0.1775
In order to execute an offshore wind farm development, an authorization by the government or a regulatory body is required. In some studies, the legal authorization process is considered as a part of project management. But since the permitting process is significantly different from country to country, we have separated them from each other in this paper. During the authorization process, appropriate documents are provided and some local authorities are contacted and asked for approval. The cost of legal authorization is estimated to be approximately 0.13 % of the CAPEX (The Crown Estate 2010; Howard 2012).
Then,
Clegal = 0,0013 x CAPEX
In order to evaluate the feasibility of offshore wind projects, some site-specific surveys need to be conducted. The type of surveys conducted usually varies according to the kind of information required. Currently, four types of surveys are used for offshore wind farm developments: environmental, coastal processes, seabed and metocean conditions. So, the cost of surveying over the P&C phase is given by:
Csurveys = Csurv‐EN + Csurv‐CP + Csurv‐SB + Csurv‐MO
where:
Csurv-EN, Csurv-CP and Csurv-SB represent the cost of carrying out, respectively, environmental, coastal processes and seabed surveys and all depend on the wind farm’s installed capacity (IC), whereas Csurv-MO represents the cost of metocean studies and is considered to be constant regardless of the number of wind turbines being built.
Once the project is approved and the final investment decision is made, a multidisciplinary team is constituted to design the offshore wind farm. Some of the activities that are undertaken during this stage include structural design and selection of foundation, design of wind farm layout and design of electrical system and grid connection. The engineering cost comprises the costs associated with main engineering activities (Ceng-main) and design verification process (Ceng-verif) (Offshore Design Engineering Ltd. 2007), i.e.
Ceng = Ceng‐main + Ceng‐verif
The cost of main engineering activities depends on the project size and is modelled as a function of the wind farm’s installed capacity (Castro-Santos and Diaz-Casas 2014). In this section, we assume that Ceng-main is the sum of a fixedbase cost (Cbase) and the term described by an increasing linear function of the installed capacity as follows:
Ceng‐main = Cbase + (Ceng‐unit x IC)
The contingency cost accounts for unpredictable annual expenses and allowance for replacement of the most expensive components subject to catastrophic failure. The contingency cost is considered a certain percentage (around 10 %) of the CAPEX (Howard 2012), i.e.
Ccontingency = 0.1 x CAPEX
The production and acquisition (P&A) cost includes all costs associated with the procurement of:
- Wind turbines (CWT),
- The support structure or foundation (CSS),
- The power transmission system (CPTS) and
- The monitoring system (Cmonitoring).
| Parameters Correlation | |
| Rotor diameter (D, in m) and RPC (MW) | D = 59.354(RPC)0.47 |
| Rotor speed (Rspeed, in rpm) and RPC (MW) | Rspeed = 22.781(RPC)−0.3595 |
| Hub height (HH) and rotor diameter (D) | HH = D/0.255(D)0.3464 |
| Hub mass including pitch, bearing and driver system (M(pb+ds), in t) and RPC (MW) | M(pb+ds) = 8.6421(RPC)1.1194 |
| Rotor mass including hub, pitch system and blades (M(hb+ps+bl), in t) and RPC (MW) | M(hb+ps+bl) = 18.453(RPC)1.1357 |
| Mass of main rotor shaft (M(ms), in t) and RPC (MW) | (M(ms)) = 0.2415(RPC)2 + 3.0699(RPC) |
| Mass of main bearing (M(mb), in t) and RPC (MW) | M(mb) = 0.1246(RPC)2 + 1.2623(RPC) |
| Mass of rotor, drive-train support structure and nacelle (M(r+d+n), in t) and RPC (MW) | M(r+d+n) = 37.45(RPC)0.984 |
| Mass of all components at top of tower (M(thm), in t) and RPC (MW) | M(thm) = 55.9216(RPC)1.0341 |
| Reference: Effect of RPC on size and mass of wind-turbine components (Tong, 2010) | |
Then,
CP&A=CWT+CSS+ CPTS+Cmonitoring
The total cost of procurement of wind turbines is described as a function of the number of wind turbines installed in the wind farm (NWT) as follows:
CWT = (Cwt‐mat + Cwt‐trans ) x NWT
where:
Cwt-mat (USD) represents the material costs for a wind turbine with all its constituent sub-systems and Cwt-trans (USD) is the transportation cost of a wind turbine from the manufacturing location to the installation site. The cost of materials depends on the nominal wind turbine power rating (PR) or Rating Power Capacity (RPC). Using a logarithmic regression model on the available dataset containing prices of various wind turbines with rated power between 2 and 5 MW (See Graph below), the material cost for a wind turbine is modelled by:
A polinomic model for cost of materials used in a wind turbine
Cwt‐mat = -263,167.31x(PR)2 + 3,079,171.98x(PR) – 2,536,395.87
The transportation cost of a wind turbine is calculated by multiplying the average vessel-day required (Nv-d) by the fixed daily rate of hiring a vessel (Vr), i.e.
Cwt‐trans = Nv‐d x Vr
The cost of a support structure is divided into two parts, one for material cost (Css-mat) and another one for transport and installation (Css-trans). Thus, the total cost of procurement of support structures is given by:
CSS = (Css‐mat + Css‐trans ) x NWT
Nielsen (2003) showed that the cost of material for a wind turbine support structure does not vary much from one type to another, but it increases by 2 % for each metre increase in water depth (WD) and by 80 % for each unit increase in load factor. Dicorato et al. (2011) modelled the average cost of materials used for a support structure by:
Css‐mat = 339,200 x PR x [1+0.02 x (WD−8)]x[(1+(0.8×10-6x(HHx(D/2)-2 )- 105)]
where:
HH and D represent, respectively, the hub height and the rotor diameter of a wind turbine in metres.
For the transportation cost of support structures, it is calculated by multiplying the average vessel-day required (Nv-d) by the fixed daily rate of hiring a vessel (Vr), i.e.
CSS‐trans = Nv‐d x Vr
The power transmission system is composed of a number of cables that connect wind turbines to the grid and onshore/ offshore substations. So, the cost of the power transmission system is given by:
CPTS = Ccables + Cof ‐subs + Con‐subs
(Ccable-unit): price of unit length of cable as function of (Power * Diam in mm)
The cables used for power transmission in offshore wind farms are divided into three parts: inter-array (i= 1), export (i= 2) and onshore (i= 3). The cable cost for each part can be calculated by the product of the price of unit length of cable (Ccable-unit), the number of lines (Nlines) and the average length of each line (L). Moreover, J-tube seals, passive seals, bend restrictors, stiffeners or cable mats are required to protect the cables at some locations. So,
Ccables =
Ccable-unit i x Li x Nlines i + Cprotection
where:
Cprotection represents the cable protection cost which varies depending on the number of wind turbines installed.
** Offshore substations are normally used when the wind farm’s installed capacity (IC) is larger than 100 MW and/ or the wind farm is very far from shore. These substations are designed specifically for each wind farm project with taking into account several factors such as the distance to shore, water depth and, more importantly, the installed capacity. In this section, a linear regression model is used in a dataset which consists of prices of substations for various wind farms whose capacities range from 300 to 1500 MW and supplemented by data presented in Myhr et al. (2014). The cost of an offshore substation is estimated as follows :
A linear regression model for offshore substation
Cof ‐subs = 846,589 + 156,603 x IC; (for IC≥100 MW)
Finally, the cost of an onshore substation is assumed to be around half of the cost of an offshore substation (Castro-Santos and Diaz-Casas 2014; The Crown Estate 2010), i.e.
Con‐subs ≅ Cof ‐subs/2
Currently, a large number of sensors and control devices are installed throughout the offshore wind farms to collect condition data (e.g. sea-state data, deterioration data). The collected information is frequently transferred to the supervisory control and data acquisition (SCADA) system and is stored in databases. The system analysts use these condition data to schedule the inspection and maintenance tasks. The cost of SCADA and condition monitoring systems (CMSs) for an offshore wind farm depends on the number of wind turbines installed (Tavner 2013). Then,
Cmonitoring = (CSCADA + CCMS )x NWT
where:
CSCADA and CCMS represent the cost of, respectively, SCADA and CMS for a wind turbine.
The installation and commissioning (I&C) phase involves all activities related to the construction of offshore wind farms. The costs incurred at this stage include those related to:
- Port (CI&C-port),
- Installation of the components (CI&C-comp),
- Commissioning of the wind turbines and electrical system (Ccomm), and
- the construction insurance (CI&C-ins).
CI&C = CI&C‐port + CI&C‐comp + Ccomm + CI&C‐ins
The port plays a key role in the supply chain management of offshore wind farms. Annual fees must be paid to local authorities for the use of port infrastructure, quayside docking, and the permission for crane use (Maples et al. 2013), which all are assumed to be fixed and known (Cport-use). In addition, the annual payments to wind farm labourers who carry out project activities (e.g. pre-assembling the components) must be taken into account (Cport-labour).Then,
CI&C‐port = Cport‐use + Cport‐labour
The port labour cost is calculated by multiplying the average labour-day required (Nl-d) by the fixed daily labour rate (Lr), i.e.
Cport‐labour =Nl‐d x Lr
Several operations need to be performed during the installation process of an offshore wind farm project. The cost of installation, according to the type of components installed, is divided into four parts: foundation (CI&C‐ f ), wind turbine (CI&C‐wt), and offshore and onshore electrical systems (CI&C‐ofsubs and CI&C‐onsubs). Then,
CI&C‐comp = CI&C‐ f + CI&C‐wt + CI&C‐ofsubs + CI&C‐onsubs
In all the above cost elements, the costs related to hiring chartered ships and technicians are also included. In addition, preparation of the seabed is often required prior to installation of the foundations. An offshore electrical system is composed of both the array and the export cables whose associated costs are a function of the total length (distance).
Before starting up an offshore wind farm, the wind turbines, electrical systems, SCADA and CMSs are tested to detect early failures and improve reliability (Dinmohammadi and Shafiee, 2013). The cost of commissioning (Ccomm) mainly consists of the costs associated with hiring vessels and crew members which can be calculated using the formulas:
Ccomm = Nv‐d x Vr
During the installation and commissioning phase, many unexpected events (such as environmental damages) may take place. In order to minimize the negative impacts of these events, various insurance packages are offered to wind farm owners. The cost of these packages often varies in accordance with the capacity of the offshore wind farm and is calculated by:
CI&C‐ins = Cins‐unit x IC
where:
Cins-unit represents the insurance cost per unit installed capacity (MW).
OFFSHORE WIND FARM PROJECT OPERATING EXPENDITURE - OPEX - ESTIMATION
The operation and maintenance (O&M) cost of an offshore wind farm is divided into two parts, one for the operational expenses (CO) and the other one for the maintenance expenses (CM).
Thus,
CO&M = CO + CM
The operational expenses of an offshore wind project include the rental/lease payments (Crent), the insurance costs (CO&Mins) and the transmission charges (Ctransmission).
Thus,
CO = Crent + CO&M‐ins + Ctransmission
The wind farm developers have to pay fees to local authorities and landowner for the seabed rentals. The amount of these fees can vary from country to country, but it is generally expressed as a fraction of the wind farm’s revenue. We assume that rental charges are calculated using the following equation:
Crent = ℓ x E x PE
where:
- 0 < ℓ <1 is the rental percentage, and
- E (MWh) and PE (USD/MWh), respectively, represent the amount of energy and the average price per unit of energy produced by the wind farm.
Operational insurance packages are contracted in order to secure the offshore wind infrastructures against design faults, collision damages or substation outages. The cost of insurance packages depends on wind farm capacity and can be calculated similarly as given in Equation below Transmission charges An annual fee has to be paid to the authorities who are in charge of the national electrical grid.
The transmission charges are generally determined according to the capacity of the wind farm.
Thus,
Ctransmission = Ctransmission‐unit x IC
where:
Ctransmission-unit represents the transmission charges per unit installed capacity (MW).
The maintenance activities aim to maximize the availability of offshore wind turbines while minimizing the costs associated with random failures. The maintenance costs can be categorized into two types, direct (CM-direct) and indirect (CM-indirect). Then,
CM = CM‐direct + CM‐indirect
Direct maintenance cost consists of the costs related to transport of failed components, maintenance technicians who carry out the repair/replacement actions and all consumables and spare parts required for wind farm maintenance. In general, the maintenance strategies for offshore wind farms are categorized into two classes: corrective maintenance (CM) and proactive maintenance (ProM). The main difference between these two classes is that the former is carried out after the failure of the system, while the latter takes place prior to any failure (i.e. before a failure occurs) (Shafiee 2015b). The cost of a CM action varies depending on the type of component being failed. Let n represent the number of components in a wind turbine system and denote by CCMj the cost of performing a CM action on component j, for any j∈ {1, 2, …, n}.
Then,
CCMj = Ctrans j + Clabour j + Cconsumj (1)
where:
Ctrans j, Clabour j and Cconsum j represent, respectively, the transportation cost, maintenance labour cost and consumables cost. The cost of consumables is assumed to be fixed in this study, but the expected costs of transport and maintenance technicians are calculated using the following equations (Shafiee and Dinmohammadi 2014):
Ctrans j = 2d x tc j (2)
Clabour j = Nl‐d j x Lr (3)
where:
d (km) represents the distance between the wind farm and the repair shop, tcj ($/km) is the transportation cost per unit distance, Nl-dj represents the average labour-day required for maintenance of component j and Lr ($/day) is the fixed daily labour rate. In order to reduce the costs of CM, two proactive maintenance strategies, namely scheduled Int J Life Cycle Assess maintenance (SM) and condition-based maintenance (CBM), are employed by wind farm managers (Shafiee 2015c). Under SM, the repair tasks are undertaken at predetermined regular intervals, but CBM activities are initiated in response to a specific system condition (e.g. temperature, vibration, noise, lubrication and corrosion) (Shafiee and Finkelstein 2015).
Let λj represent the annual failure rate of component j and 0<Pd< 1 be the probability that an event can be detected at a reasonably long time ahead of failure occurrence. Thus, the annual cost for individual maintenance of the wind turbine components can be expressed by:
where:
CSMj represents the direct cost corresponding to a scheduled maintenance of the component j and is less than the cost of failure, i.e. CSMj<CCMj for any j∈ {1, 2, …, n}. From Eq. 3, it can be seen that the detection capability of the monitoring system plays a key role in reducing the annual direct maintenance costs. The detection capability can be improved through using new monitoring techniques such as acoustic emission, ultrasonic testing, strain measurement, radiographic inspection, thermography and signal processing methods (Márquez et al. 2012).
Indirect maintenance cost consists of the cost of activities that are undertaken to maintain the direct effort involved in providing repair services. Indirect costs may be either fixed or variable. Independently from the number of maintenance tasks to be carried out, port fees must be paid for spare parts storage and quayside facilities. A number of vessels also have to be hired for the maintenance. Besides this, various operations (e.g. weather forecasting, scheduling of repair tasks) should be accomplished onshore to coordinate the maintenance activities (Garrad Hassan 2013). Hence, the indirect maintenance cost is given by:
CM‐indirect = Cind‐port + Cind‐ves + Cind‐labour
where:
Cind-port, Cind-ves and Cind-labour represent, respectively, the port fees, vessel hiring costs and maintenance labour costs.
OFFSHORE WIND-FARM DECOMMISSIONING & ABANDON EXPENDITURE - DECAB OR ABEX - ESTIMATION MODEL (CLASS 5-4)
The decommissioning and disposal is the final stage of a wind project life cycle, whose procedure is the reverse of the installation and commissioning (I&C) process. The wind turbines at the end of their anticipated operational life are decommissioned, the wind farm equipment depending on the chosen waste management strategy are either removed or recycled, the offshore site is cleared and, lastly, some postdecommissioning monitoring activities are performed.
Then:
CD&D = Cdecom + CWM + CSC + CpostM
where:
Cdecom, CWM, CSC and CpostM represent the costs associated with, respectively, decommissioning, waste management, site clearing and post-monitoring.
The decommissioning cost consists of the costs associated with port preparation (CD&D-port) and removal operations (Cremov). Then, the decommissioning cost is given by:
Cdecom = CD&D‐port + Cremov
The cost of port preparation, CD&D-port, can be calculated as
CD&D‐port = Cport‐use + Cport‐labour
Where: The port labour cost is calculated by multiplying the average labour-day required (Nl-d) by the fixed daily labour rate (Lr), i.e.
Cport‐labour = Nl‐d x Lr
For the cost of removal operations, the ecuation:
Ctrans = Nv‐d x Vr
Can be applied considering that less specialized vessels are required for decommissioning activities.
The waste management strategy determines how the wind farm elements will be disposed. The main disposal options available are as follows: reuse, recycle, incineration with energy recovery and disposal in a landfill site (Department of Energy and Climate Change DECC 2011). Independently from the waste treatment option chosen, the materials must be first processed into smaller pieces and then transported to predetermined locations which incur the costs CW-proc and CW-trans, respectively. A fixed fee has also to be paid when the materials are taken to a landfill (Clandfill). Then,
CWM = CW‐proc + CW‐trans + Clandfill –SV
where:
SV ($) represents the salvage (residual) value of the decommissioned assets.
After decommissioning wind turbines, the waste materials must be processed subject to strict quality controls. The cost of waste processing varies in accordance Maintenance strategy Corrective maintenance Proactive maintenance Scheduled maintenance Condition-based maintenance figure shown below Wind farm maintenance strategies Int J Life Cycle Assess with the complexity and size of components. In this paper, CW-proc is modelled as a function of the total weight of waste material being treated. Hence,
CW‐proc = ∑n j=1 W j x Cproc‐unit
Cproc-unit ($/ton) is the fixed cost of waste processing per ton and Wj is the weight of waste material collected from component j in tons.
After processing, the waste materials are transported to either a landfill or the recycling depot. The transportation cost is calculated by multiplying the expected number of trucks required to transfer the waste materials by the fixed charge per truck shipment (Ctruck), i.e.
where:
Wtruck represents the capacity of a truck in tons and ⌈x⌉ rounds x to the nearest larger integer.
Salvage value is defined as the expected or estimated value of an asset at the end of its operational life. A large portion of the materials used in a wind turbine can be recycled (e.g. stainless steel). The salvage value of the items removed from an offshore wind farm depends on the type, quantity (i.e. volume or weight) and quality (or condition) of materials recycled. Let k = 1,2, …, m represent the type of scrap material and SVk be the salvage value per ton of material of type k. The salvage (residual) value of the decommissioned components is expressed by the following formula:
Following the decommissioning of the offshore wind farm, the whole site must be cleared in accordance with the approved regulations. Site clearance involves the removal of all assets of the offshore wind project. The cost associated with site clearance is calculated by multiplying the site area in square kilometres (A) by the clearance cost per unit area (CSC-unit), i.e.
CSC = A x CSC‐unit
Some of the offshore wind components (e.g. cables) may not be fully removed through the decommissioning process. For this reason, a post-decommissioning monitoring and management plan is required to identify and mitigate the risks that may be posed by remaining materials on the seabed. The cost of a post-decommissioning monitoring programme (CpostM) is determined according to several factors such as scale, nature and the conditions of remains (Department of Energy and Climate Change DECC 2011). This cost is considered to be fixed.
OFFSHORE WIND FARM MATERIAL, FABRICATION AND INSTALLATION - DATABASE COST ETIMATION MODEL (CLASS 3-2)
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