O&M issues must be addressed; European profit warnings must be heeded
Wind energy has arguably become the dominant renewable energy in Europe, but if it is to compete effectively in electricity markets, more accurate O&M cost forecasts are needed.
The number of turbines in production means that operators are now looking at reducing O&M costs to see significant gains in profitability. With no fuel costs, a wind farm is totally dependent on smart use of operational expenditure (OPEX) to be profitable.
In less than five years, a wind turbine will likely have its warranty expire. With 79% of existing wind turbines about to exit warranty, O&M costs for wind power are double or triple the figures that were originally predicted in the financial models used to secure investment and finance. 0.019 euro per kWh is the average real cost of O&M compared with estimated costs from a leading wind turbine OEM of $0.005 per kWh.
Leading operators demand that now is the time to plan for ways to boost ROI and increase profit margins by planning ahead and accurately forecasting O&M costs. Greater investment in O&M can have proven positive returns, while a robust, repeatable and cost effective O&M strategy is proven to have an immediate impact on an operator’s bottom line.
As a result we are seeing a fundamental change insofar as utility companies and IPPs are shifting away from the availability figure and moving towards establishing a process that is repeatable, consistent and that has an ease of knowledge transfer.
Operations and maintenance of wind energy in this Europe is costly, technically challenging and potentially a brief investment if your staff cannot be retained. In order to set yourself up for success the following challenges must be faced:
- Improving margins through OPEX efficiency
- Identifying and mitigating underperformance
- A full understanding of third party service providers
- Data Analysis
- Staff – analysts and on site technicians
- Offshore Specific considerations for nearshore and farshore operation
- Access to Engineering Expertise
Wind Energy Update’s O&M Summit 2010, to be held in Madrid on November 23-24, deals with these issues and more. This exclusive meeting can supply your business with the critical intelligence and tools you need to build cost effective, time efficient offshore wind power plants.
Iberdrola I&C, EDP Renewables, Siemens, Vestas, GE Energy, RE Power Systems AG, Accenture, PWC, Ynfiniti Engineering Services and many others are set to share their installation and permitting experience. Find out more at: www.windenergyupdate.com/Madrid
For more information about this event, please contact:
Head of Sector
Wind Energy Update
+44 207 3757 247