Cost of Energy Technologies

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Cost of Energy Technologies ( cost-energy-technologies )

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World Energy Council 2013 Cost of Energy Technologies Wind Between 2000 and 2010 the global capacity of onshore and offshore wind increased an average of 30% per year, reaching 200GW installed in 2010. 2012 was a record year for new onshore wind installations with over 46GW of capacity built in the year. Offshore wind is just beginning to be installed at scale and BNEF forecasts that by 2020 global capacity will reach nearly 50GW. Regionally, Europe, the US and China account for the bulk of onshore wind capacity while offshore capacity is focused off the coast in Europe with development also occurring along the snore lines of China and South Korea. China will likely be a major force in the future for offshore wind, but delays affecting current projects continue to push out the deployment horizon. Since BNEF began tracking onshore wind LCOEs in mid-2009, values have fallen by 18%, a rate greater than the turbine experience curve, as a result of increasingly cheaper con- struction costs and higher capacity factors. Meanwhile offshore LCOEs have crept upwards, reflecting the increased costs of projects further from shore coupled with cost overruns due to harsh construction environments and the complex nature of construction at-sea. Figure 4 Levelised cost of wind electricity over time, developed market average (USD/MWh) Source: Bloomberg New Energy Finance 250 200 150 100 50 0 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2009 2010 2011 2012 2013 Onshore wind Core technology costs and performance Wind turbines make up the single largest component of the CAPEX required for an onshore wind installation, roughly 63% of total cost. The remaining components include concrete foundations, on-site electrical and site-preparation and transport. Depending on a project site’s location relative to the manufacturing facility supplying the turbines, transportation costs can cause total CAPEX to increase substantially. The makeup of the global turbine manufacturing industry can be broken into two distinct segments: Chinese manufacturers, which accounted for approximately 40% of supply in 2012 and global manufacturers, which account for the remainder. Manufacturing facilities are spread globally. Turbine costs, as measured by the Bloomberg New Energy Finance Wind Turbine Price Index, are down nearly 30% from peak prices in 2008, as measured in Euros. A growing split how- ever has emerged between the prices paid for older models versus newer models. Older model turbines continue to decline in price while newer models have become more expensive, Offshore Onshore 13

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