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RENEWABLE POWER GENERATION COSTS IN 2019

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RENEWABLE POWER GENERATION COSTS IN 2019 ( renewable-power-generation-costs-in-2019 )

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Figure 2.6 depicts the historical evolution of onshore wind capacity factors for commissioned projects in each year across the 15 markets where IRENA has the longest time series data. Average capacity factors increased by just over half for the 15 countries examined in Figure 2.6. Granted, there are varying start dates for commercially deployed projects, but nonetheless, this shows the scale of capacity factor improvements. Indeed, compared to the earliest commissioned project in 1984 in the United States, capacity factors in 2019 increased by over 130%, while capacity factors in Denmark, Sweden and Canada have increased by more than 80% between their earliest deployment and 2019. Brazil, like the United States, has excellent onshore wind resources and in 2019, newly commissioned projects had a weighted average capacity factor of 51%. Table 2.2 shows the more recent change in capacity factors for projects commissioned in the same 15 countries for the 2010-2019 period. Except for Mexico, all the countries experienced improvements in the weighted average capacity factor, with an increase of between 9% in the United Kingdom and 44% in Denmark and Spain. OPERATION AND MAINTENANCE COSTS Operation and maintenance costs for onshore wind often make up a significant part (up to 30%) of the LCOE for this technology (IRENA, 2018a). Technology improvements, greater competition among service providers, and increased operator and service provider experience are, however, driving down O&M prices. This trend is being supported by increased efforts by turbine OEMs to secure service contracts given the potentially higher profit margins available than in turbine supply (BNEF, 2020 and Wood MacKenzie, 2019a). Nonetheless, the share of the O&M market covered by turbine OEMs continues to shrink, with asset owners increasingly internalising major parts of O&M services or using independent service providers in order to reduce costs. This share fell from 70% in 2016 to 64% in 2017 and it is expected to fall a further ten percentage points in 2027, to 54% (Make Consulting, 2017). Table 2.2 Country-specific average capacity factors for onshore wind, 2010 and 2019 ONSHORE WIND 2010 2019 Percentage change 2010-2019 % Denmark 27 39 44% Spain 27 39 44% Brazil 36 51 42% United States 33 44 33% Turkey 26 34 33% Sweden 29 38 33% India 25 32 30% Italy 26 33 30% Germany 24 31 30% France 27 33 25% China 26 32 24% Canada 32 39 21% United Kingdom 30 33 9% Japan 24 25 4% Mexico 40 35 13% Source: IRENA Renewable Cost Database. 55

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