The impact of wind power support schemes on technology choices

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in AbstractGermany changed renewable remuneration for wind power from a fixed Feed-In Tariff (FIT) to a floating Market Premium Scheme (MPS) in 2012. One aim of this adjustment was to better align the supply of generated wind electricity with the demand for it, e.g. through more system-friendly wind turbine technology choices. In energy systems with a high share of variable renewable energies, such turbines produce a higher share of their production at lower wind speeds and thus can reduce the need for alternative flexibility options like back-up capacity, storage, grid extensions and demand side measures. However, based on a wind power investment model, I show that the MPS fails to convey strong enough incentives to project developers to significantly alter their investment decisions as long as these base their investments on current electricity market price profiles and are limited by their access to risk-averse project finance. One reform proposal to support the installation of system-friendly turbines is a change in the production volume-based benchmark approach which plays an integral part in both the fixed FIT and the MPS. The investment model indicates that such a revised policy can incentivize the deployment of moderately more system-friendly wind power technologies at some locations. An alternative option is to shift to a production value-based benchmark approach. It directly reflects the future additional market value of system-friendly turbines in today's remuneration structure. Thus, this approach sets incentives also for investors without perfect foresight -or with financing constraints -to deploy more systemfriendly turbines that meet the requirements of power systems with increasing shares of wind power.

On the economics of electrical storage for variable renewable energy sources

“…Both market forces and the renewables support scheme in Germany tend to incentivize renewable generation when prices are higher and supply is, accordingly, scarce. Such system-friendly renewables comprise wind turbines that dis-proportionally produce electricity when wind speeds are low, both due to their location and technical layout (May, 2017). A similar argument holds for solar PV panels, which may be directed such that they generate more electricity in morning or afternoon hours.…”

Competitiveness of a low specific power, low cut-out wind speed wind turbine in North and Central Europe towards 2050

“…Andrew Mills and Ryan Wiser from Lawrence Berkeley National Laboratory have done a number of studies on the economic value of wind, looking into different strategies to increase economic value of wind (and other VRE) at higher VRE penetration rates, such as varying geographic location, real-time pricing, and technology diversity ( [11], [12], [13], [14][15]). Other studies have shown that lowering the specific power of wind turbines can both increase their market value and reduce costs on the system, since they produce energy at times other wind turbines do not, making them "system-friendly" turbines [16], [17], [18]. There have also been studies that have looked specifically at how LW turbines compare to conventional turbines using the Balmorel energy system model (which is used in this paper as well), with the turbines modelled having specific powers (W/m 2 ) of 400, 325, 300, 250, 200, and 175 [19][6].…”

Referenzplan als Grundlage für einen wissenschaftlich fundierten und mit den Pariser Klimazielen in Einklang stehenden Nationalen Energie- und Klimaplan für Österreich (Ref-NEKP) - Gesamtband

“…Das MPM setzt einen Anreiz, in Turbinen zu investieren, die effizienter bei niedrigeren Windgeschwindigkeiten sind, insbesondere Anlagen mit relativ geringer Nennleistung, langen Rotorblättern, und hohen Türmen. Der zusätzliche Marktwert durch die höhere Produktion unter schlechten Bedingungen kann dabei die zusätzlichen Investitionskosten übersteigen (May, 2017). Dieser Anreiz ergibt sich jedoch nur unter ausreichendem Preisrisiko und Information der Investoren.…”