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

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.This research was funded by the Basque Government through the BERC 2018–2021 programme and by the Spanish Ministry of the Economy and Competitiveness (MINECO) through BC3 María de Maeztu excellence accreditation MDM-2017-0714. Further support is provided by the MINECO project RTI 2018-093352-B-I00

Powering newly constructed vessels to comply with ECA regulations under fuel market prices uncertainty: Diesel or dual fuel engine?

Over the last decade, marine engine engineering has evolved considerably, to the point where engine technology can be considered mature and reliable using LNG as fuel without affecting safety at sea. This paper analyses the choice between diesel or dual engines jointly and considers the alternatives of installing or not installing a sulphur scrubber when building a new vessel. The dual engine is more flexible because it can consume liquefied natural gas (LNG) as other marine fuels but the initial investment is more expensive. On the other hand, the use of scrubbers enables the use of marine fuels with high sulphur content in Emission Control Areas (ECAs), these marine fuels are usually cheaper also we consider Selective Catalytic Reduction technology (SCR) in all cases to minimize NOx. The paper calibrates a stochastic model for LNG and determines four marine fuel correlated prices. The work also considers a possible regulatory change from a non ECA to an ECA in the future. When we aggregate the installation costs to the present value of the expected combustible cost under uncertainty we can select the cheapest alternative. We obtain a minimum of expected present value of investment and fuels cost of 25.62 million US$ with a Dual engine with scrubber configuration. Our work shows that, in the cases considered, the use of a dual engine is the best alternative minimizing the total of investment and fuel costs. Finally, we analyse the distribution of fuel cost and its associated risks. © 2018 Elsevier LtdThis research is supported by the Basque Government through the BERC 2018-2021 program and by Spanish Ministry of Economy and Competitiveness MINECO through BC3 María de Maeztu excellence accreditation MDM-2017-0714. Additionally Luis M. Abadie is grateful for financial support received from the Basque Government via project GIC12/177-IT-399-13 and the Spanish Ministry of Science and Innovation via project ( ECO2015-68023 ).Basque Government, Spanish Ministry of Science and Innovation, Spanish Ministry of Economy and Competitiveness MINEC

Optimal Slow Steaming Speed for Container Ships under the EU Emission Trading System

Slow steaming is an operational measure in ocean-going vessels sailing at slow speeds. It can help climate mitigation efforts by cutting down marine fuel consumption and consequently reducing CO2 and other Greenhouse Gas Emissions (GHG). Due to climate change both the European Union (EU) and the International Maritime Organization (IMO) are analysing the inclusion of international shipping in the EU Emissions Trading System (ETS) in the near future or alternatively implementing a carbon tax. The paper proposes a methodology to decide the optimal speed of a vessel taking into account its characteristics and the factors that determine its economic results. The calculated cash flow can be used in valuation models. The methodology is applied for a case study for any container ship in a range from 2000 to 20,000 Twenty-foot Equivalent Units (TEU) on a leg of a round trip from Shanghai to Rotterdam. We calculate how speed reduction, CO2 emissions and ship owner’s earnings per year may vary between a business-as-usual scenario and a scenario in which shipping is included in the ETS. The analysis reveals that the optimal speed varies with the size of the vessel and depends on several variables such as marine fuel prices, cargo freight rates and other voyage costs. Results show that the highest optimal speed is in the range of 5500–13,000 TEUs whether or not the ETS is applied. As the number of TEUs transported in a vessel increases emissions per TEU decrease. In an established freight rate market, the optimal speed fluctuates by 1.8 knots. Finally, the medium- and long-term expectations for slow steaming are analysed based on future market prices.This research is supported by the Basque Government through the BERC 2018–2021 programme and by the Spanish Ministry of Economy and Competitiveness (MINECO) through BC3 María de Maeztu excellence accreditation MDM-2017-0714. Further support is provided by the project MINECO RTI 2018-093352-B-I00

Nola aurre egin itsas garraioak eragindako klima-aldaketari? Estrategia berriak

Currently maritime transport is growing due to globalization and economic growth, and it transports approximately the 90% of the world’s goods. World maritime transport fleet is increasing in amount and in size of vessels and, accordingly, marine fuel oil consumption is also increasing. The marine fuel oil consumption represents the 50% of the operational costs of a vessel and it has a huge environmental impact (ocean acidification, pollution, greenhouse effect, climate change…). Consequently, IMO (International Maritime Organization) created a specific environmental regulation and divided the ocean in different ECA zones (Emission Control Areas). The present work analyses the best strategy, a shipowner should adopt, to comply with ECA regulations, in three different panoramas: i) using an active vessel, placing a scrubber or consuming low sulphur marine fuel oil; ii) constructing a new vessel, choosing between marine dual engine or marine diesel mengine in both cases with or without scrubber; and iii) in case new ECA zones are created, which affects directly the vessel’s operational area.; Gaur egun, itsas garraioak munduko ondasunen % 90 mugitzen du. Ekonomiaren hazkundea eta globalizazioa direla-eta, garraio mota hori goraka doa. Munduko garraioontzi flotaren kopurua haziz doan neurrian, fuel-olioaren kontsumoa ere hazten ari da. Fuel-olioaren kostua garraio-ontzi baten kostu operazionalen % 50 baino gehiago da, eta erregai horren erabilerak eragin nabarmena du ingurumenean (azidifikazioa, kutsadura, berotegi-efektua…); hori kontuan izanik, ECA direlako guneetan (Emission Control Areas) banatu ditu munduko itsasoak IMOk (International Maritime Organization), ingurumen-legedi berezi baten pean. Artikulu honetan, aztergai da zer estrategia jarraitu behar duen armadore batek (itsasontzi baten ustiatzaileak) lege sorta horietara egokitzeko, honako hiru aldagai hauek kontutan izanda: i) eraikita dagoen itsasontzi bat ustiatzen badu, sufre gutxiagoko fuelak erabiltzea edo itsasontziaren motorra egokitzea; ii) itsasontzi berri bat eraikitzera badoa, motor duala edo diesel-motorra jartzea; eta iii) zer aukera dagoen IMOk ECA gune berriak sortzeko