Managing Wind Turbine Generators with a Profit Maximized Approach

In Europe, at least 3 GW installed capacity of wind turbine generators (WTG) will fall out of subsidy schemes every year from 2021 onwards. An estimated 50% of this capacity cannot be replaced with new WTG due to commercial and legal restrictions. The remaining options are either to sell the electri...

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Bibliographic Details
Published in:Sustainability 2020-09, Vol.12 (17), p.7139
Main Authors: McInnis, Dominik, Capezzali, Massimiliano
Format: Article
Language:English
Subjects:
Commercialization
Costs
Electricity
Electricity consumption
Flexibility
Generators
Linear programming
Market prices
Optimization
Power plants
Production costs
Profit maximization
Profits
Revenue
Sustainability
Tariffs
Turbines
Turbogenerators
Wind power
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Summary:In Europe, at least 3 GW installed capacity of wind turbine generators (WTG) will fall out of subsidy schemes every year from 2021 onwards. An estimated 50% of this capacity cannot be replaced with new WTG due to commercial and legal restrictions. The remaining options are either to sell the electricity without subsidies on the wholesale electricity market—a novelty for most WTG, as most are receiving a feed-in tariff—or their dismantlement. Since the electricity market fixes the price at the intersection of demand and short run marginal production costs, WTG might struggle to generate enough revenues to cover their costs. This paper proposes an innovative commercialization strategy for WTG after the end of the feed-in tariff, namely a profit-maximized approach that focuses on synergies between revenues and costs when increasing the curtailments of the WTG. The two key elements of this approach are a more flexible and variable cost structure and a central overall optimization process. The paper proves the potential of this new strategy and highlights the necessity of further research for WTG at the end of their lifetime from a technical and commercial perspective, due to the impact on the initial investment decision and best allocation of subsides.
ISSN:2071-1050
2071-1050
DOI:10.3390/su12177139