Europe’s new permit, grid rules set to hike wind repowering spending

New European Union legislation is set to accelerate demand for life extensions and full repowering on Europe's ageing wind fleet, industry experts told New Energy Update.

Demand for larger repowering projects is set to rise after supportive legislation accelerates the process. (Image credit: Vinzo)

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Siemens Gamesa recently signed a contract to extend the lifespan of 238 MW of wind capacity in Spain from 20 years to 30 years.

The life extension program will consist of monitoring and structural upgrades at 264 wind turbines owned by an unnamed Spanish company. The turbines are situated at six wind farms in the provinces of Zaragoza and Teruel and have an average age of 15 years.

An increasing number of Europe's wind turbines are reaching the end of their 20-year design lifespans, requiring operators to choose between life extension, full repowering, or decommissioning. 

Siemens Gamesa's contract in Spain shows how European wind operators are typically favoring life extension rather than full repowering, due to cost and permitting challenges.

More than 15 GW of German wind capacity is over 15 years old, representing 35% of installed capacity, WindEurope said in a report published in October. In Spain, 6 GW is older than 15 years (25%) while in Denmark around 2.7 GW, more than half of the wind fleet, has reached this age.

             Wind turbine ages by country

                              (Click image to enlarge)

Source: WindEurope, August 2018.

While full repowering allows operators to install larger, higher efficiency turbines, these projects require greater permitting approval and do not usually gain any extra price support. Environmental regulation is stricter than when the turbines were originally installed and power prices have slumped in recent years.

“There is a market for [full] repowering, but mostly because of permitting issues this is not yet gaining momentum,” Ivan Komusanac, markets and wind energy technology analyst at Wind Europe, said.

As more turbines reach end of life, the annual market for full repowering in Europe is predicted to rise steadily over the next 10 years, from 1 to 2 GW in 2017 to 5.5 GW-8.5 GW in 2027, WindEurope data shows.

As European countries tighten their grip on carbon emissions, new rules will provide a boost to operators of ageing assets. European Union (EU) energy legislation to be adopted this year is set to improve the economics of both life extension and full repowering projects, industry experts said.

Support looms

National regulation and power price trends are key factors when deciding end-of-life decisions.

Currently, Italy is the only EU member state offering a concrete incentive for lifetime extensions and full repowering projects.

Elsewhere in Europe, life extension projects must ensure sufficient returns after tariffs expire. Full repowering projects must compete against new renewable projects in competitive tenders.

“If a project developer can make a profitable business case and gets the permits for a new installation [it] will repower. If not, a good alternative would be a life extension of three to seven years, depending on the technical status and the initial refurbishment investment,” Ulrich Schulze Sudhoff, Business Development Director at GE, told New Energy Update.

                    Central, Western European (CWE) power prices

                                                          (Click image to enlarge)

Source: European Commission's Quarterly Electricity Market Report.

New rules approved by the European Parliament and the EU Council in December will set in motion new support mechanisms for life extension and repowering projects.

Renewable Energy Directive II and governance regulation, due to be effective from 2021, require member states to implement streamlined procedures for permitting and grid connection for repowering projects, and include repowering in national renewable energy targets.

New measures may include "stabilization mechanisms for lifetime extension or repowering projects,” Schulze Sudhoff said.

“Different initiatives are underway to anchor binding provision into the national climate plans,” he said.

“Any incoming regulation that reduces uncertainty or provides more visibility to owners, will reduce costs and facilitate penetration of renewable energy,” Siemens Gamesa told New Energy Update.

Analysis challenge

Operators considering life extensions face the considerable challenge of assessing the potential technical lifespan of their assets. These assessments require detailed safety and cost analysis.

Germany and Denmark are leading an industry trend towards a consistent technical life extension assessment process initiated by legal requirements, according to an academic paper published by a group of European researchers in early 2018.

For large wind farms, individual turbine assessment for lifetime extensions is not cost-effective and data-driven approaches could reduce costs, the paper, ‘Lifetime extension of onshore wind turbines,’ said. For owners of a large number of assets, data-driven approaches provide further economies of scale, it said.

Standardized procedures to document the operational history of the wind turbine and site conditions, access to design data and stable and clear legal frameworks would improve life extension decisions, the paper concluded.

Turbine suppliers will continue to play a central role in life extension decisions. Siemens Gamesa is developing software that collects real-time data on "fatigue accumulation" to minimize faults and improve end-of-life decisions, the company told New Energy Update.

“What is key for life extension is to ensure a common understanding of ageing mechanisms, so manufacturers can provide common certifications and guarantee to local authorities and owners that operating a wind turbine far beyond their original design life is totally safe,” Siemens Gamesa said.

By Beatrice Bedeschi