Wind Power Economics

The economic performance of your Wind Project is perhaps the most important consideration and calculation. In the real world Wind Projects are most successful when they generate positive cash-flow. The true value of a Wind Project has a direct economic component (market value of energy), an environmental component, and a social-political component.

These values can be translated into an economic dollar value that can be utilized to leverage the cash-flow position of your wind project. In short, the true value of wind can be defined in many ways, for purposes of this Planning Guide we’re going to focus on the hard Value of Energy: the Market. On the island of Kauai, the current Value of Energy is 41 cents/KWH.

The Value of Energy is defined by how much electricity is worth at a given point of delivery. The Two Most Important aspects of your Wind Project are: how much does it cost to install? And, how much does it produce in Electricity?

To analyze your Initial Installed Cost (IC), add up the following cost considerations:

Purchase Price ____________

Shipping Costs: ___________

Off-Loading Costs: ________

Site-Preparation Costs: ______

Foundation Costs: __________

Utility Intertie Costs: ________

Installation Costs ___________

Special Equipment ie. Crane ___

Data Acquisition System ______

Cost of Land: _______________

The economic parameters will give you a great metric to measure and track the actual costs and performance factors that determine the profitability of wind projects. Print this list for your workbook, and use as a work sheet.

Wind Generator Power and Energy Economics wipoec