Optimal Timing of Onshore Wind Repowering in Germany under Policy Regime Changes: A Real Options Analysis

Circular economy and renewable energy infrastructure such as offshore wind farms are often assumed to be developed in synergy as part of sustainable transitions. Offshore wind is among the preferred technologies for low-carbon energy. Deployment is forecast to accelerate over ten times faster than onshore wind between 2021 and 2025, while the first generation of offshore wind turbines is about to be decommissioned. However, the growing scale of offshore wind brings new sustainability challenges. Many of the challenges are circular economy-related, such as increasing resource exploitation and competition and underdeveloped end-of-use solutions for decommissioned components and materials. However, circular economy is not yet commonly and systematically applied to offshore wind. Circular economy is a whole system approach aiming to make better use of products, components and materials throughout their consecutive lifecycles. The purpose of this study is to enable the integration of a sustainable circular economy into the design, development, operation and end-of-use management of offshore wind infrastructure. This will require a holistic overview of potential circular economy strategies that apply to offshore wind, because focus on no, or a subset of, circular solutions would open the sector to the risk of unintended consequences, such as replacing carbon impacts with water pollution, and short-term private cost savings with long-term bills for taxpayers. This study starts with a systematic review of circular economy and wind literature as a basis for the coproduction of a framework to embed a sustainable circular economy throughout the lifecycle of offshore wind energy infrastructure, resulting in eighteen strategies: design for circular economy, data and information, recertification, dematerialisation, waste prevention, modularisation, maintenance and repair, reuse and repurpose, refurbish and remanufacturing, lifetime extension, repowering, decommissioning, site recovery, disassembly, recycling, energy recovery, landfill and re-mining. An initial baseline review for each strategy is included. The application and transferability of the framework to other energy sectors, such as oil and gas and onshore wind, are discussed. This article concludes with an agenda for research and innovation and actions to take by industry and government.

Section: Repoweringmentioning

confidence: 99%

A Framework and Baseline for the Integration of a Sustainable Circular Economy in Offshore Wind

Velenturf

2021

“…Referring to policies and the design of regulatory elements for managing equipment at end-of-life, Madlener et al [22] investigate the optimal timing of onshore wind repowering under the premium regime in Germany. Invernizzi et al [23] provide foundations for incorporating circular economy principles into an integrated decommissioning policy to promote sustainable management in energy infrastructures.…”

Section: Of 23mentioning

confidence: 99%

Old Wind Farm Life Extension vs. Full Repowering: A Review of Economic Issues and a Stochastic Application for Spain

Abadie

Goicoechea

2021

The installation of wind power technology is growing steadily and the trend can be expected to continue if the objectives proposed by the European Commission are to be achieved. In some countries a considerable percentage of installed wind power capacity is near the end of its useful lifetime. In the case of Spain, the figure is 50% within five years. Over the last 20 years, wind energy technology has evolved considerably and the expected capacity factor has improved, thus increasing annual energy production, and capital expenditure and operational expenditure have decreased substantially. This paper studies the optimal decision under uncertainty between life extension and full repowering for a generic wind farm installed in the Iberian Peninsula when the future hourly electricity prices and the capacity factor evolve stochastically and seasonally. The results show that in economic terms, full repowering is the best option, with a net present value of €702,093 per MW installed, while reblading is the second best option. The methodology can be transferred to other specific wind farms in different electricity markets and can be used to develop national wind energy policy recommendations to achieve projected shares in the electricity mix.

“…Moreover, they concluded that laws had to be updated in parallel with technology or be mitigated with instruments of subsidies in order to favor repowering. Recently, Madlener et al analyzed the evolution of the regulatory framework of RES laws in Germany, and proposed a model to determine the optimal moment to repower according to the EEG ('Erneuerbare Energien Gesetz', Renewable Energy Law 2017), which also considers technical and economic factors [64]. Economically, early repowering is more beneficial, and it is highly influenced by the rate granted at the beginning of the project.…”

Section: Multi-category Analysismentioning

confidence: 99%

“…Revised papers by country and technology. Period (2000-2021).Germany[38,39,[44][45][46]54,58,60,64,71,96,101,102] …”

mentioning

confidence: 99%

A Multi-Factorial Review of Repowering Wind Generation Strategies

Gil-García¹,

Fernández‐Guillamón

García-Cáscales

et al. 2021

The integration of renewables into power systems is a key transformation for mitigating climate change and reducing fossil-fuel dependence. Among the different resources, wind participation has become crucial in recent decades—both onshore and offshore wind power plants. However, assuming the useful life of the wind turbines at approximately 20 years, different solutions should be discussed to overcome the turbine’s aging problem. In the coming years, some countries within the wind sector will face the decision of partially or totally repowering or dismantling their turbines. This paper reviews different repowering strategies and contributions from a multifactorial perspective. A set of categories is defined by the authors and those multifactorial parameters are then classified according to such categories: technical, economic, environmental, social, and political. From each category, the most relevant factors to be considered for repowering decision-making purposes are identified and discussed. According to the specific literature, more than 90% of the reviewed contributions are focused on onshore wind power plant repowering actions. This percentage is in line with onshore and offshore wind generation units installed in recent decades. The reviewed studies show that Germany has a major number of contributions. Regarding offshore repowering strategies, all contributions propose a multifactorial analysis, in contrast to onshore repowering strategies where only 68% of the authors carry out a multifactorial analysis. The revised repowering methodologies and the categorization of factors can also be used by the repowering market, as a useful tool in the near future.