Friday, 16 October 2015

Irish Academy of Engineering call for wind farms to pay for associated grid and system costs

The Academy of Engineering recommends that the new renewable support scheme for wind generation should :

  • Reset REFIT reference prices for new developments, undertaken post 2015, to the levels originally set for 2004, to reflect the fall in materials and financing costs 
  • Remove CPI indexation from those technologies which are essentially fixed cost, in the case of new developments 
  • Remove the Balancing Price paid to suppliers of renewable generation, as there is now no justification for such a payment, particularly following the completion of the EastWest Interconnector 
  • Remove access to system marginal prices, when those are higher than REFIT provisions, in the case of both existing and new developments, as payments in this case are both unjustified and are likely to increase significantly, as wind penetration increases. It is inappropriate that wind generators benefit from the system problems caused by increasing wind farm penetration. 
  • Require that new renewable electricity developments contribute to the full cost of associated network reinforcements, in proportion to the share of additional capacity required for their development. This will help concentrate development in areas with existing network capacity and thus minimise the requirement for highly controversial new overhead lines. 
  • Given that Ireland has substantially more onshore wind generation potential than can ever be exploited there is in Ireland’s case no justification for introducing a separate and higher pricing regime for offshore wind. Thus the Academy supports the present position of not differentiating between onshore and offshore wind.

1 comment:

  1. On shore wind get approximately 70 euros per mwh, plus about 10 cents from the PSO levy as a direct subsidised guaranteed price so long as the market price stays below the guaranteed price. If the market price goes above the guaranteed price, the wind companies get paid the higher price. The market price for 21 hours is about 36 euros at present rising to about 120 for the remaining 4 peak hours. I cannot say if wind gets the higher (120 price) for the 4 peaking hours or the daily price is averaged out. Average daily price is 57 cents. The engineering and maintenance costs of off shore wind is prohibitive and its capacity factor is not much greater than on shore wind. It needs massive subsidies to break even and the gear box problems are just as problematical as for on shore wind. If in the future Ireland were to rely on off shore wind alone (if the inertia problem could be overcome), the price would be so high that no one would use mains electricity, Home generation would be the only option together with bottled and mains gas,