Wind Energy Investments Research Articles

آفاق تطوير الاستثمارات البيئية:, الاستثمار في طاقة الرياح نموذجا: دراسة تجربة الاتحاد الأوروبي

The Importance Of This Study Is Coming Of Its Being Treats The Development Of Environmental Investments Issue On The Process Of Transition Toward An Economy Depends On Sustainable Energy. In Systematically Analysis, We Aim To Give A Clear Picture Of Dimensions Of Investment In Wind Energy And To Highlight The Opportunities And Challenges Are Represented By The Wave Such This Type Of Investment To Achieve A Production Of Clean And Renewable Energy In The EU Countries In Light Of The Challenges Of Sustainable Development. Key Words - Environmental Investments, Wind Energy Investments, European Union

A real options approach to analyse wind energy investments under different support schemes

A real options model is developed to evaluate wind energy investments in a realistic and easily applicable way. Considering optimal investment timing and sizing (capacity choice), the model introduces a capacity constraint as part of the optimisation. Several correlated uncertainty factors are combined into a single stochastic process, which allows for analytical (closed-form) solutions. The approach is well suited for quantitative policy analysis, such as the comparison of different support schemes. A case study for offshore wind in the Baltic Sea quantifies differences in investment incentives under feed-in tariffs, feed-in premiums and tradable green certificates. Investors can under certificate schemes require up to 3% higher profit margins than under tariffs due to higher variance in profits. Feed-in tariffs may lead to 15% smaller project sizes. This trade-off between faster deployment of smaller projects and slower deployment of larger projects is neglected using traditional net present value approaches. In the analysis of such trade-off, previous real options studies did not consider a capacity constraint, which is here shown to decrease the significance of the effect. The impact on investment incentives also depends on correlations between the underlying stochastic factors. The results may help investors to make informed investment decisions and policy makers to strategically design renewable support and develop tailor-made incentive schemes.

Impact of Electricity Pricing Policies on Renewable Energy Investments and Carbon Emissions

We investigate the impact of pricing policies (i.e., flat pricing versus peak pricing) on the investment levels of a utility firm in two competing energy sources (renewable and conventional), with a focus on the renewable investment level. We consider generation patterns and intermittency of solar and wind energy in relation to the electricity demand throughout a day. Industry experts generally promote peak pricing policy as it smoothens the demand and reduces inefficiencies in the supply system. We find that the same pricing policy may lead to distinct outcomes for different renewable energy sources due to their generation patterns. Specifically, flat pricing leads to a higher investment level for solar energy, and it can lead to still more investments in wind energy if a considerable amount of wind energy is generated throughout the day. We validate these results by using electricity generation and demand data of the state of Texas. We also show that flat pricing can lead to substantially lower carbon emissions and a higher consumer surplus. Finally, we explore the effect of direct (e.g., tax credit) and indirect (e.g., carbon tax) subsidies on investment levels and carbon emissions. We show that both types of subsidies generally lead to a lower emission level but that indirect subsidies may result in lower renewable energy investments. Our study suggests that reducing carbon emissions through increasing renewable energy investments requires careful attention to the pricing policy and the market characteristics of each region.This paper was accepted by Serguei Netessine, operations management.

Some aspects of the occurrence and behaviour of the crane Grus grus in Poland in light of pre-investment wind-farm monitoring

Abstract Ornithological pre-investment monitoring at planned wind farm sites is a standard and obligatory procedure in Poland and other EU countries. Pre-investment wind farm monitoring has a very important ‘side effect’ to its main goal (the safety of bird populations), namely the collection of valuable avifaunistic data from many localities that most probably would never be studied if not for the obligation to prepare environmental reports when wind energy investments are planned. The main aim of this paper is to show what we can learn from obligatory pre-investment monitoring when the standard field monitoring procedure and unified evaluation methodology are used. As an example the Common Crane Grus grus was selected, as a bird listed in Annex 1 of Directive 2009/147/EC and easy to identify and count. The data were collected at 155 controlled monitoring sites all over Poland, but mainly along the Baltic coast and in the Masurian Lake District. The methodology of the data collection and evaluation of results was strictly according to a paper by Busse (2013). The presentation of the results includes the numerical distribution of cranes in all seasons and some details of their behaviour - observations of birds on the ground and those using the air space: below the future rotor swept area of the wind turbines, at the rotor swept height, and flying above it. The estimated collision rates vary depending on the area, season and local heights of movements. It was concluded that such an evaluation of data already collected could be helpful in evaluating a particular site in comparison with other, previously studied localities.

Is There a Future for Nuclear Power? Wind and Emission Reduction Targets in Fossil-Fuel Alberta.

This paper explores the viability of relying on wind power to replace upwards of 60% of electricity generation in Alberta that would be lost if coal-fired generation is phased out. Using hourly wind data from 17 locations across Alberta, we are able to simulate the potential wind power output available to the Alberta grid when modern, 3.5 MW-capacity wind turbines are spread across the province. Using wind regimes for the years 2006 through 2015, we find that available wind power is less than 60% of installed capacity 98% of the time, and below 30% of capacity 74% of the time. There is only a small amount of correlation between wind speeds at different locations, but yet it remains necessary to rely on fossil fuel generation. Then, based on the results from a grid allocation model, we find that CO2 emissions can be reduced by about 30%, but only through a combination of investment in wind energy and reliance on purchases of hydropower from British Columbia. Only if nuclear energy is permitted into the generation mix would Alberta be able to meet its CO2-emissions reduction target in the electricity sector. With nuclear power, emissions can be reduced by upwards of 85%.

Gestão energética e inovação sustentável: a formação de preço da energia eólica no estado do rio grande do norte

O cenário energético mundial nos últimos anos tem passado por um processo de mudança devido ao aumento dos preços dos combustíveis fósseis e dos impactos ambientais, impelindo inúmeros investimentos e estudos em energia eólica. A isso, o estado do Rio Grande do Norte tem recebido diversos investimentos, com a construção de novos parques eólicos na região, tendo em vista, este ter o maior potencial eólico do Brasil, que por sua vez tem fomentado o setor com políticas específicas à produção de energia renovável. Nesse sentido, o seguinte artigo tem por objetivo desenvolver um modelo de formação de preço da energia eólica no estado do Rio Grande do Norte no processo de gestão energética dessa inovação sustentável. Em formato teórico-empírico, por uma metodologia exploratória e explicativa, encontraram-se resultados que evidenciam e definem as principais variáveis que interferem no preço da energia eólica, sendo estas: os custos com equipamentos, os incentivos governamentais e o formato brasileiro de competitividade dos leilões de energia elétrica.

Investments in Renewable and Conventional Energy: The Role of Operational Flexibility

Problem definition: There is an ongoing debate on how providing a subsidy for one energy source affects the investment level of other sources. Academic/practical relevance: To investigate this issue, we study a capacity investment problem for a utility firm that invests in renewable and conventional energy, with a consideration of two critical factors. First, conventional sources have different levels of operational flexibility—inflexible (e.g., nuclear and coal) and flexible (e.g., natural gas). Second, random renewable energy supply and electricity demand are correlated and nonstationary. Methodology: We model this problem as a two-stage stochastic program in which a utility firm first determines the capacity investment levels followed by the dispatch quantities of energy sources to minimize the sum of investment and generation-related costs. Results: We derive the optimal capacity portfolio to characterize the interactions between renewable and conventional sources. Policy implications: We find that renewable and inflexible sources are substitutes, suggesting that a subsidy for nuclear or coal-fired power plants leads to a lower investment level in wind or solar energy. However, wind energy and flexible sources are complements. Thus, a subsidy for flexible natural gas-fired power plants leads to a higher investment in wind energy. This result holds for solar energy if the subsidy for the flexible source is sufficiently high. We validate these insights by using real electricity generation and demand data from the state of Texas.

European Union funds in the development of renewable energy sources in Poland in the context of the cohesion policy

The paper aims at determining the role played by funds from the European Union in the development of renewable energy sources in Poland in the context of European Union cohesion policy. We have derived data from the official European Funds Portal for the size of projects and the financial support obtained from the European Union for the use of a specific renewable energy source. We have analyzed all (928) projects related to hydro- and geothermal energy, biomass (together with biogas), wind, and solar energy implemented in all 16 voivodships (administrative regions of the second order, NUTS 2). It must be mentioned that, in the programming period 2007–2013, the available European Union funds made it possible to obtain the largest support for all investments in renewable energy sources in Poland so far. The total value of the projects co-financed from these funds has amounted to 2 billion euro. Analyzing the value of investments in technologies based on varied renewable energy sources, an evident disproportion in either the size of particular installations or the costs of investments is observed. We demonstrate that large wind farms constitute more than 60% of the total value of investments in renewable sources subsided by the European Union. Small projects have also been subsided, but mainly those related to solar energy. Generally, the wind energy investments are established in northern and western parts of Poland, including Zachodniopomorskie, Pomorskie, Dolnośląskie, and Łódzkie voivodships, while the solar energy investments are found in the eastern and southern parts of Poland.

Lessons learnt from the evaluation of the feed-in tariff scheme for offshore wind farms in Greece using a Monte Carlo approach

Offshore wind energy development is considered essential to meet European targets for CO2 emissions reduction. However, offshore wind farms face not only typical risks associated with emerging technologies, but much higher uncertainties arising from various technical, political, economic and regulatory risks, most of which have been aggravated during the recent economic crisis. This is especially true in Greece where despite the investors’ interest there is no progress in the realisation of offshore wind farms. The scope of this paper is to investigate the profitability range of offshore wind energy investments in Greece, taking into consideration the uncertainties faced. To this purpose, a systematic profitability analysis is performed in twelve offshore wind projects, using a Monte Carlo simulation integrated into a classical financial model for the treatment of various sources of uncertainty and in relation to the eventual variation of feed-in tariffs, as foreseen in the current legislative framework. The proposed methodological approach has proved to be a very useful tool for policy makers, enabling the simultaneous consideration of a significant number of uncertainty drivers. Moreover, the obtained results demonstrate the difficulties to propose a common feed-in tariff level for all offshore wind farms even in a small country like Greece.

Sensitivity to the use of 3DVAR data assimilation in a mesoscale model for estimating offshore wind energy potential. A case study of the Iberian northern coastline

In this work, the WRF meteorological model is run in three different modes to estimate the wind energy potential in the Bay of Biscay for the 1990–2001 period. The first simulation (NODA) involves a typical use of the WRF model and it does not use data assimilation. The second one (12hDA) performs 3DVAR data assimilation at 00 UTC and 12 UTC. Finally, 6hDA uses 3DVAR data assimilation at 00 UTC, 06 UTC, 12 UTC and 18 UTC. Verification for the three simulations has been carried out at a preliminary stage using wind data from buoys, and then a spatially distributed analysis has been conducted of surface wind based on satellite data from the Cross-Calibrated Multi-Platform (CCMP). To that purpose, the spatial correlation and error patterns over our study area have been used as statistical indicators. The results indicate that the wind values obtained with data assimilation every six hours (6hDA) yield the best verification scores at a 95% confidence level, thereby being the most accurate at reproducing wind observations in the area. Regarding the estimation of wind energy potential, at a second stage, we tested the calculation’s sensitivity to the use of data assimilation. The most reliable simulation with data assimilation (6hDA) estimates 21% less energy potential than the simulation without data assimilation. In the absence of historical wind observation records of the sea with sufficient time and space resolution, meteorological models such as WRF provide an estimation of the wind values in tentative areas for offshore wind farms. In this line, our study highlights the need to use meteorological models with data assimilation, as future wind energy production can then be more realistically estimated beforehand. This may also contribute to a more accurate economic and technical evaluation of the risks and benefits for future investments in offshore wind energy.

The effect of sample size on European Union’s renewable energy investment drivers

ABSTRACTMacroeconomic modelling results based on relatively varying sample sizes may lead to incoherent results. Such effects have not been adequately understood in the renewable energy literature regarding the European Union (EU). This study focuses on the comparison of results obtained for renewable energy investment drivers (for solar and wind energy investments) on different samples of EU countries, including all EU-27, former EU-15 and 11 high renewable investment EU countries. The study used a random effect panel data modelling approach over the period 1995–2011 for studying the impact of the levelized cost, regulation perception, carbon emissions and climatic condition on wind and solar investments over the three samples. The results demonstrate the importance of trustable regulation schemes to ensure that regulation will not have a significant negative effect on investment, showing also the need to further extend the model to include support schemes as fundamental drivers for investment.

Firm Type, Feed‐in Tariff, and Wind Energy Investment in Germany: An Investigation of Decision Making Factors of Energy Producers Regarding Investing in Wind Energy Capacity

SummaryThe development of renewable and sustainable energy is advanced by public financial support. This is particularly so in the German Energiewende, which seeks to replace nuclear and fossil electricity generation with wind, sun, and biomass. We study the impact of the (changes in the) feed‐in tariff (FIT) policy on the investment in wind electricity generation capacity in Germany in the period 2000–2014. We estimate a generic investment model that includes this support mechanism, the cost of capital, investment risks such as wind and price volatility, and manufacturing costs. We discuss specific features for different types of wind energy investors, such as the incumbents, small private investors, diversified companies, and independent power producers. We find that a change in the FIT has a negative impact on investment capacity regarding the generation of wind energy: A one monetary unit increase in the variation of the tariff is to be associated with a decrease by 0.17 megawatts of wind capacity installed. We argue that it is policy uncertainty that makes investors shy away from making real investments. We also argue that the drivers for wind energy investment can differ along different types of firms. For the traditional power producers, especially electricity price volatility, construction costs, and carbon prices seem to matter. But for the other investor types, the FIT is crucial indeed.

How does uncertainty in renewable energy policy affect decisions to invest in wind energy?

This paper examines the impacts of uncertainties in U.S. renewable energy policy on the investment decisions of renewable electricity producers. We develop and solve a dynamic optimization model to understand how investment in wind energy depends on market and policy uncertainties. These uncertainties include the federal government’s uncertain decision about the continuation of the Production Tax Credit (PTC) policy and the stochasticity of prices in the market for Renewable Electricity Credits (RECs). Our results show that investors require higher REC prices to invest without the PTC policy. Results contribute to our understanding of how policy uncertainty affects the profitability threshold required for investors to commit to renewable energy projects.

Risks and cost of capital for onshore wind energy investments in EU countries

The national binding targets, set for renewable energy deployment at European Union (EU), call for extended clean energy investments. Renewable energy projects require high up-front expenditures including, in many cases, considerable financing costs. The main objective of this paper is to elaborate and apply a methodology that allows assessing the most important risk categories related to renewable energy investments. The cornerstone of this approach is the weighted average cost of capital, which has been extracted for new onshore wind projects in EU-28 member states based on diverse methods e.g. Capital Asset Pricing Model. Moreover, to validate the model results, a series of interviews with renewable energy project developers and financers across the EU has been conducted. The results show that, following the country risk, policy-related risks exert the highest impact on the cost of capital. Moreover, there are significant discrepancies between different geographical regions and market deployment levels. To support policy makers' decision on effective risk-reducing policy designs, the assessment could also be extended to other renewable energy technologies.

A Comparison of Wind Energy Investment Alternatives Using Interval-Valued Intuitionistic Fuzzy Benefit/Cost Analysis

One of the tools for maintaining environmental sustainability is transformation from fossil-based energy sources to renewable energy sources in energy consumption. Among renewable energy alternatives, wind energy is the most prominent and reliable energy source for fulfilling energy demand. Traditional investment evaluation techniques based on discounted cash flows are not capable of capturing the uncertainty and vagueness in the data related to the wind energy investment parameters. Fuzzy capital budgeting techniques can capture this vagueness and model the imprecise estimations of parameter values. In this paper, we develop interval-valued intuitionistic fuzzy benefit-cost analysis for the evaluation of wind energy technology investments. The fuzzy benefit-cost analyses are based on both present worth and annual worth analyses. The developed analyses can handle the assessments of multiple experts through aggregation operators. In the proposed economic model, the components of each wind energy investment parameter are incorporated into the equations in detail. A real case study is also presented in this paper.

Is it really all about the return on investment? Exploring private wind energy investors' preferences

Achieving EU climate targets requires an immense volume of investments in renewable energies, especially in the field of wind energy. Private individuals can play an essential role in raising significant parts of the necessary financial resources. This requires, however, a thorough understanding of investors' preferences. Based on choice experiments by 725 German respondents who intend to invest in wind energy in the near future, this article shows that private individuals' investment decisions are not only made with profit maximization in mind. Furthermore, this study reveals that an individual's age, asset valuation and environmental attitude significantly affect the preference for different wind energy investment attributes. The findings of this study have important implications for financial institutions and for policy, as the findings indicate that private individuals are not well informed about many aspects of wind energy investments.

What drives investment in wind energy? A comparative study of China and the European Union

Although the expansion of new renewable energy has been dependent on support in state policies, the research literature has scant focus on the political motivations for implementing policies to stimulate such development. The growth of wind power is an illustrative case of renewables expansion, as this is the most mature of the new renewable technologies. What can explain the rapid development of wind power production capacity in the EU and in China, despite their very different political systems and basic preconditions? Applying the method of most-different systems design in combination with document studies and interviewing, this article demonstrates how large-scale investments in wind power have come about through a specific set of political motivations backed by strong governmental support policies with similar main aims: security of energy supply, creating future-oriented industries and employment, and reducing greenhouse gas emissions and local pollution. These three factors together, broadly perceived, might also explain the political motivations that drive large investment in new renewable energy sources elsewhere.11An earlier version of this paper has been published in Energy Procedia.

Drivers and Barriers for Renewable Energy Investments in Emerging Countries The Case of Wind Energy in China, India and Brazil

Developing and emerging countries are gaining importance on the renewable energy stage due to their growth prospects in several areas and a strong investment increase in the recent past. This paper is dedicated to investigating the drivers and barriers to investments in renewable energies in developing countries. It explores these by using a unique dataset of institutional investors comparing wind energy investments in India, China and Brazil (as representatives of the BRICS countries) by means of a case study. Factors affecting the investments of large institutional investors include the legal framework (including policies), the institutional environment (including infrastructure), overarching macro-economic stability (including currency risk) and growth potential.

Public policy and financial resource mobilization for wind energy in developing countries: A comparison of approaches and outcomes in China and India

We analyze and contrast how China and India mobilized financial resources to build domestic technological innovation systems in wind energy. To that end, we identify distinct stages of technology diffusion in the two countries in the period 1986–2012, and analyze the interplay between public policies and the development of the technological innovation system across the different stages. We show that the two countries’ distinct development strategies for wind energy – China developed wind energy largely through its state-owned enterprises, while India opened up wind energy investment to the private sector in the early 1990s – influenced system outcomes in terms of technology diffusion, domestic industry structure, competitiveness, and ownership. By unraveling the interplay between public policies, investment risks and returns, and actor characteristics, we explain the differences in system outcomes and identify important policy trade-offs between the two strategies. Our analysis provides novel insights about the process of financial resource mobilization in technological innovation systems, the dynamics of innovation-system growth, and the policy trade-offs that must be reconciled by countries that aim to promote the diffusion of a particular technology.

English

Dr. Hadadi Sudheendra, Mr Tefera Mekonnen, Mr Melaku Dept of ECE, Jimma University, JIT, Ethiopia Synopsis: As per the recent scenario the wind energy generation is the key source of energy to avoid the green house effect, since the green house effect as well the global warming is a serious threat to the environment . Hence popular to the investors, government, and general public since the 1970s. The awakening of higher investments in wind energy was caused by growing need for energy security. There are, however, numerous problems and challenges, both short and long term, with developing wind power generation. The U.S. Department of Energy identifies several key challenges in wind power energy development: risk perception, the transmission and grid limits, the low competitiveness of wind energy, low speed wind location usage, lack of Infrastructure for transmission, regulatory policy, environmental policy, environmentalists, and general public opinion (DOE 2007, 8, 18).