Evaluating the economic return to public wind energy research and development in the United States

The U.S. government has invested in wind energy research since 1976. Building on a literature that has sought to develop and apply methods for retrospective benefit-to-cost evaluation for federal research programs, this study provides a quantitative analysis of the economic social return on these historical wind energy research investments. Importantly, the study applies multiple innovative methods and varies important input parameters to test the sensitivity of the results. The analysis considers public wind research expenditures and U.S. wind power deployment over the period 1976–2017, while also accounting for the full useful lifetime of wind projects built over this period. Assessed benefits include energy cost savings and health benefits due to reductions in air pollution. Overall, this analysis demonstrates sizable, positive economic returns on past wind energy research. Under the core analysis and with a 3% real discount rate, the net benefits from historical federal wind energy research investments are found to equal $31.4 billion, leading to an 18 to 1 benefit-to-cost ratio and an internal rate of return of 15.4%. Avoided carbon dioxide emissions are not valued in monetary terms, but are estimated at 1510 million metric tons. Alternative methods and input assumptions yield benefit-to-cost ratios that fall within a relatively narrow range from 7-to-1 to 21-to-1, reinforcing in broad terms the general finding of a sizable positive return on investment. Unsurprisingly, results are sensitive to the chosen discount rate, with higher discount rates leading to lower benefit-to-cost ratios, and lower discount rates yielding higher benefit-to-cost ratios

How Does Wind Project Performance Change with Age in the United States?

Wind-plant performance declines with age, and the rate of decline varies between regions. The rate of performance decline is important when determining wind-plant financial viability and expected lifetime generation. We determine the rate of age-related performance decline in the United States wind fleet by evaluating generation records from 917 plants. We find the rate of performance decline to be 0.53%/year for older vintages of plants and 0.17%/year for newer vintages of plants on an energy basis for the first 10 years of operation, which is on the lower end of prior estimates in Europe. Unique to the United States, we find a significant drop in performance by 3.6% after 10 years, as plants lose eligibility for the production tax credit. Certain plant characteristics, such as the ratio of blade length to nameplate capacity, influence the rate of performance decline. These results indicate that the performance decline rate can be partially managed and influenced by policy

Impacts of variable renewable energy on wholesale markets and generating assets in the United States: A review of expectations and evidence

We synthesize available literature, data, and analysis on the degree to which growth in variable renewable energy (VRE) has impacted or might in the future impact bulk power system assets, pricing, and costs in the United States. Most studies of future scenarios indicate that VRE reduces wholesale energy prices and capacity factors of thermal generators. Traditional baseload generators are more exposed to these changing market conditions than low-capital cost and more flexible intermediate and peak-load generators. From analysis of historical data we find that VRE is already influencing the bulk power market through changes in temporal and geographic patterns areas with higher levels of VRE. The most significant observed impacts have concentrated in areas with significant VRE and/or nuclear generation along with limited transmission, with negative pricing also often occurring during periods with lower system-wide load. So far, however, VRE, has had a relatively modest impact on historical average annual wholesale prices across entire market regions, at least in comparison to other drivers. The reduction of natural gas prices is the primary contributor to the decline in wholesale prices since 2008. Similarly, VRE impacts on thermal plant retirements have been limited and there is little relationship between the location of recent retirements and VRE penetration levels. Although impacts on wholesale prices have been modest so far, impacts of VRE on the electricity market will be more significant under higher VRE penetrations

Opportunities for and challenges to further reductions in the “specific power” rating of wind turbines installed in the United States

A wind turbine’s “specific power” rating relates its capacity to the swept area of its rotor in terms of Watt per square meter. For a given generator capacity, specific power declines as rotor size increases. In land-rich but capacity-constrained wind power markets, such as the United States, developers have an economic incentive to maximize megawatt-hours per constrained megawatt, and so have favored turbines with ever-lower specific power. To date, this trend toward lower specific power has pushed capacity factors higher while reducing the levelized cost of energy. We employ geospatial levelized cost of energy analysis across the United States to explore whether this trend is likely to continue. We find that under reasonable cost scenarios (i.e. presuming that logistical challenges from very large blades are surmountable), low-specific-power turbines could continue to be in demand going forward. Beyond levelized cost of energy, the boost in market value that low-specific-power turbines provide could become increasingly important as wind penetration grows

Annual report on U.S. wind power installation, cost, and performance trends: 2006

This report--the first in what is envisioned to be an ongoing annual series--attempts to fill this need by providing a detailed overview of developments and trends in the U.S. wind power market, with a particular focus on 2006

Annual Report on U.S. Wind Power Installation, Cost, and Performance Trends: 2007 (Revised)

This report focuses on key trends in the U.S. wind power market, with an emphasis on the latest year, and presents a wealth of data, some of which has not historically been mined by wind power analysts

Deviations from Matthiessen's Rule for SrRuO3{\rm SrRuO_3} and CaRuO3{\rm CaRuO_3}

We have measured the change in the resistivity of thin films of ${\rm SrRuO_3}$ and ${\rm CaRuO_3}$ upon introducing point defects by electron irradiation at low temperatures, and we find significant deviations from Matthiessen's rule. For a fixed irradiation dose, the induced change in resistivity {\it decreases} with increasing temperature. Moreover, for a fixed temperature, the increase in resistivity with irradiation is found to be {\it sublinear}. We suggest that the observed behavior is due to the marked anisotropic scattering of the electrons together with their relatively short mean free path (both characteristic of many metallic oxides including cuprates) which amplify effects related to the Pippard ineffectiveness condition

Biomass power and state renewable energy policies under electric industry restructuring

Several states are pursuing policies to foster renewable energy as part of efforts to restructure state electric power markets. The primary policies that states are pursuing for renewables are system benefits charges (SBCs) and renewable portfolio standards (RPSs). However, the eligibility of biomass under state RPS and SBC policies is in question in some states. Eligibility restrictions may make it difficult for biomass power companies to access these policies. Moreover, legislative language governing the eligibility of biomass power is sometimes vague and difficult to interpret. This paper provides an overview of state RPS and SBC policies and focuses on the eligibility of biomass power. For this paper, the authors define biomass power as using wood and agricultural residues and landfill methane, but not waste-to-energy, to produce energy

Financing investments in renewable energy: The role of policy design and restructuring

The costs of electric power projects utilizing renewable energy technologies are highly sensitive to financing terms. Consequently, as the electricity industry is restructured and new renewables policies are created, it is important for policymakers to consider the impacts of renewables policy design on project financing. This report describes the power plant financing process and provides insights to policymakers on the important nexus between renewables policy design and finance. A cash-flow model is used to estimate the impact of various financing variables on renewable energy costs. Past and current renewable energy policies are then evaluated to demonstrate the influence of policy design on the financing process and on financing costs. The possible impacts of electricity restructuring on power plant financing are discussed and key design issues are identified for three specific renewable energy programs being considered in the restructuring process: (1) surcharge-funded policies; (2) renewables portfolio standards; and (3) green marketing programs. Finally, several policies that are intended to directly reduce financing costs and barriers are analyzed. The authors find that one of the key reasons that renewables policies are not more effective is that project development and financing processes are frequently ignored or misunderstood when designing and implementing renewable energy incentives. A policy that is carefully designed can reduce renewable energy costs dramatically by providing revenue certainty that will, in turn, reduce financing risk premiums