"We're estimating a levelised cost of energy (LCOE) for wind projects to be installed in 2012 and 2013 that ranges from as low as $33/MWh in the better windresource regimes to as high as about $65/MWh in lower wind speed areas," Ryan Wiser, a staff scientist at the lab, said during a webcast presenting the results of the draft study. The figures, he added, incorporate both the $0.022/kWh federal production tax credit and the value of accelerated depreciation.
The study compared wind's LCOE - or the minimum price at which energy must be sold for a project to break even - over three time periods. They included 2002/03, when the price tag for an installed project bottomed out at $1,300/kW; 2009/10 when it peaked at $2,150/kW; and 2012/13 when capital costs are expected to range from $1,600/kW for projects using standard turbines to $2,025/kW for those using low wind speed machines with 100-metre towers and rotor diameters.
Between 2002 and 2009, the cost of energy rose as capital costs increased, the analysis found. But the equation changes for projects scheduled to come online in the next couple of years. Although it is still more expensive to build projects than it was a decade ago, the higher capital costs are matched with an enormous increase in expected performance, Wiser said.
Those capacity factor improvements have made wind's LCOE 5-26% lower today than it was a decade ago, depending on the wind resource at the project site. If changes in operations-and-maintenance costs, financing rates and turbine availability are also factored in, said Wiser, the LCOE is as much as 24-39% lower than 2002/03.
The recent proliferation of turbines that are specifically designed for lower wind speeds has also narrowed the gap in the LCOE between low and high wind speed sites. This has made less windy areas more economically attractive for installing projects and opened up a considerable amount of additional land area for potential development, he added.
"That may help alleviate, at least to some extent, some of the transmission and siting barriers that exist for high wind speed sites," said Wiser.
The study found, for example, that the land area in the US with capacity factors greater than 35% has increased by 130-270% since 2002, depending on whether standard or low wind speed turbine technology is used.
There is also an increase in the amount of land that meets certain LCOE thresholds, Wiser said. The land base that will support projects generating wind energy for less than $55/MWh, for example, has grown by 48% over the past decade.