The Economic Viability of Renewable Portfolio Standard Support for Offshore Wind Farm Projects in Korea
Abstract
:1. Introduction
2. Predicting the Market Price of Electricity
3. Predicting the REC (Renewable Energy Certificate) Price
Year | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | After 2021 |
---|---|---|---|---|---|---|---|---|
Fraction of renewable energy | 3.5% | 4% | 5% | 6% | 7% | 8% | 9% | 10% |
4. Assessment of Wind Energy Production
5. Revenue and Cost for Offshore Wind Farms
6. Metrics of Economic Evaluation
7. Case Study
Fuel Type | Capacity (MW) | |
---|---|---|
Nuclear | 24,516 | |
Coal | 28,294 | |
Gas | 31,372 | |
Oil | 3161 | |
Renewable energy | Wind | 3286 |
Solar | 1807 | |
Other | 3610 | |
Other sources | 11,073 | |
Total installed capacity | 107,119 |
Year | Nuclear (MW) | Coal (MW) | Gas (MW) | Oil (MW) | Renewable Energy | Other Sources (MW) | Total Installed Capacity (MW) | ||
---|---|---|---|---|---|---|---|---|---|
Wind (MW) | Solar (MW) | Other (MW) | |||||||
2016 | 0 | 7760 | 1752 | −809 | 1070 | 1 | 109 | 1127 | 118,129 |
2017 | 1400 | 600 | 950 | 812 | 485 | 4 | 334 | −810 | 121,904 |
2018 | 1400 | 2370 | −480 | 0 | 2430 | 0 | 200 | 1 | 127,825 |
2019 | 1400 | 5370 | 0 | 0 | 2246 | 32 | 743 | 744 | 138,360 |
2020 | 1400 | 0 | 0 | 0 | 1506 | 9 | 1256 | 3 | 142,534 |
2021 | 1400 | 1000 | 0 | 0 | 2700 | 0 | 206 | −3 | 147,837 |
2022 | 1400 | 0 | 0 | 0 | 1880 | 70 | 289 | −1200 | 150,276 |
2023 | 1500 | 0 | −1800 | −1200 | 450 | 795 | 238 | 1200 | 151,459 |
2024 | 1500 | 0 | 0 | 0 | 0 | 840 | 240 | −1400 | 152,639 |
2025 | 0 | 0 | 0 | 0 | 0 | 863 | 541 | 0 | 154,043 |
2026 | 0 | 0 | 0 | −1400 | 0 | 0 | 876 | 1400 | 154,919 |
2027 | 0 | 0 | 0 | 0 | 1222 | 993 | −255 | 0 | 156,879 |
2028 | 0 | 0 | 0 | 0 | 715 | 565 | 272 | 922 | 159,353 |
2029 | 0 | 0 | 0 | 0 | 699 | 521 | 284 | −50 | 160,806 |
2030 | 0 | 0 | 0 | 0 | 681 | 476 | 299 | −96 | 162,166 |
2031 | 0 | 0 | 0 | 0 | 661 | 432 | 315 | −130 | 163,443 |
2032 | 0 | 0 | 0 | 0 | 639 | 387 | 333 | −155 | 164,647 |
2033 | 0 | 0 | 0 | 0 | 615 | 343 | 353 | −172 | 165,786 |
2034 | 0 | 0 | 0 | 0 | 591 | 299 | 374 | −182 | 166,867 |
2035 | 0 | 0 | 0 | 0 | 565 | 254 | 396 | −187 | 167,895 |
Fuel Type | Marginal Cost ($/kWh) | FOR |
---|---|---|
Coal | 0.0289 | 0.048 |
Gas | 0.1522 | 0.07 |
Oil | 0.1160 | 0.05 |
Other | 0.0058 | 0.015 |
Region | Average Wind Speed (m/s) | Shape Parameter | Capacity Factor |
---|---|---|---|
I | 5.925 | 1.8887 | 24.3% |
II | 6.300 | 1.8091 | 27.8% |
III | 7.073 | 1.3526 | 30.8% |
Term | Description |
---|---|
Wind turbine | |
Model | NREL 5-MW Baseline WT |
Rated power (MW) | 5 |
Cut-in wind speed (m/s) | 3 |
Rated wind speed (m/s) | 11.4 |
Cut-off wind speed (m/s) | 25 |
Rotor diameter (m) | 127.5 |
Hub height (m) | 90 |
Maximum CP | 0.466 |
Conversion loss coefficients | Quadratic = 0, Linear = 0.055, Constant = 0.02 |
Monopile-type foundation | |
Steel cost ($/kg) | 0.751 |
Steel density (kg/m3) | 7870 |
Monopile diameter (m) | 5.5695 |
Monopile thickness (m) | 0.075 |
Wind farm | |
Size | 100 MW |
Configuration | 2 WTs × 10 WTs |
Spacing between WTs | 10 diameters ×10 diameters |
Others | |
Wind shear exponent | 0.143 |
Air density (kg/m3) | 1.228 |
Submarine cable loss coefficient | Internal = 0.025, External = 0.04 |
Availability | 0.98 |
Item | Figure |
---|---|
Inflation rate | 3% |
Nominal discount rate | 7.12% |
Corporate tax rate | 22% |
Loan fraction | 65% |
Loan interest rate | 4% |
Amortization period (years) | 10 |
Grace period (years) | 3 |
Depreciation period (years) | 15 |
Construction period (years) | 3 |
Operations period (years) | 20 |
Scenario 1: Adjustment for REC Weighting | Scenario 2: Adjustment for MMF |
---|---|
W − 1.25 | F − 2.5% |
W − 1.0 | F − 2.0% |
W − 0.75 | F − 1.5% |
W − 0.5 | F − 1.0% |
W − 0.25 | F − 0.5% |
W | F |
W + 0.25 | F + 0.5% |
W + 0.5 | F + 1.0% |
W + 0.75 | F + 1.5% |
W + 1.0 | F + 2.0% |
W + 1.25 | F + 2.5% |
8. Conclusions
Acknowledgments
Author Contributions
Conflicts of Interest
Nomenclature
AWEP | Annual wind energy production |
AWEPWF | AWEP of a WF |
AWEPWT | AWEP of a WT |
Ci | Cumulative sum of installed capacities of all conventional generators up to the ith conventional generator |
dL | Infinitesimal increment in load |
EPP | Electric power producer |
fC,i | PDF of unavailable capacity of ith conventional generator |
fi | PDF of equivalent load of ith conventional generator |
FIT | Feed-in tariff |
fL | PDF of original load |
FOR | Forced outage rate |
FORi | FOR of ith conventional generator |
fP,# | PDF of output of PF # multiplied by −1 |
fW,# | PDF of output of WF # multiplied by −1 |
fWP | PDF of equivalent load incorporating M WFs and N PFs |
I | Index of conventional generator |
IRR | Internal rate of return |
K | Index for type of renewable energy resource |
LCOE | Levelized cost of energy |
M | Number of WFs |
MMF | Mandatory minimum fraction |
N | Number of PFs |
Nc | Number of conventional generators |
NPV | Net present value |
Probability density function | |
PF | PV farm |
PPC | Probabilistic production cost |
PV | Photovoltaic |
REC | Renewable energy certificate |
RPS | Renewable portfolio standard |
T | Year of operation of WF |
WF | Wind farm |
WT | Wind turbine |
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Min, C.-G.; Park, J.K.; Hur, D.; Kim, M.-K. The Economic Viability of Renewable Portfolio Standard Support for Offshore Wind Farm Projects in Korea. Energies 2015, 8, 9731-9750. https://doi.org/10.3390/en8099731
Min C-G, Park JK, Hur D, Kim M-K. The Economic Viability of Renewable Portfolio Standard Support for Offshore Wind Farm Projects in Korea. Energies. 2015; 8(9):9731-9750. https://doi.org/10.3390/en8099731
Chicago/Turabian StyleMin, Chang-Gi, Jong Keun Park, Don Hur, and Mun-Kyeom Kim. 2015. "The Economic Viability of Renewable Portfolio Standard Support for Offshore Wind Farm Projects in Korea" Energies 8, no. 9: 9731-9750. https://doi.org/10.3390/en8099731