Print Friendly, PDF & Email

Wind, solar and natural gas have the lowest levelized cost of electricity (LCOE) in the majority of counties across the United States, according to a new report from The University of Texas at Austin’s Energy Institute, part of a series of white papers on the Full Cost of Electricity.

The report breaks down the costs of each resource by county and found wind to be a cost-competitive electricity source across all parts of the country. When environmental externalities and availability areas are factored into the analysis, wind fared even better. In the areas where wind was not the lowest cost resource, it was often the second lowest, with the average difference between the first and second least cost technology for all locations at $0.029/kilowatt hour (kWh).

Looking at the full picture

Beyond a traditional LCOE analysis, this research adds value by considering environmental externalities and geographic differences. Scenarios considering environmental externalities produced by each form of power generation, including air and carbon pollution, and embedded life cycle analysis greenhouse gases, allow for a fuller comparison of costs across technologies.

Furthermore, most LCOE models do not account for the different costs of building and operating an identical power plant across differing geographic regions. This analysis expresses the spatial differences of the costs of each technology across the entire United States. Because capital and operating costs, fuel price, emissions, capacity factors, and others issues vary across regions, so does the LCOE. This study considers the cost of labor, financial support from the government, and supporting infrastructure to deliver a “full cost” of each source of power generation.

Where and why wind is cheapest

Changes in generation technologies have supported a shift in the dynamics of the electric power industry. The evolution of technology has significantly contributed to declining costs of renewable energy, paired with an increasing number of competitive electricity markets and stringent emissions standards, to create favorable market conditions for wind. In fact, wind’s costs have decreased by 69 percent since 2009, making it the cheapest source of new electric generating capacity in many parts of the country. Increased consumer education and awareness of the economic and environmental benefits of renewable energy has helped to expand the market for wind and solar as well.

While this was the high-level conclusion, the analysis also provided the lowest LCOE in each county under the changing scenarios. For example, as shown below in Scenario 3, with the minimum cost technology, including externalities, wind is the lowest cost option in the most counties, with combined-cycle natural gas following as the least cost option in counties where the wind resource is not as strong.

As shown in the Scenario 3 map below, wind is the cheapest option across the central plains and the Appalachian Mountains, natural gas across the coastal plain and parts of the northern Rocky Mountains, and solar leading across the Southwest. Across the central plains, there is an excellent wind resource with a high capacity factor. This capacity factor coupled with the environmental advantages wind has over other fossil fuel generation technologies allows it to have the lowest LCOE in this area. As another benefit, wind as a source of electricity is not vulnerable to fluctuating fuel costs (whether that be the actual price of gas, or an external cost associated with carbon) that allows wind to be predictably low cost and stable.

The study also developed an online calculator tool to allow various stakeholders, including both policymakers and the public, to estimate the cost implications of policy actions. This tool also provides a high level of transparency of the inputs used in calculating the various LCOEs. It is helpful in determining which factors have the largest impact on the overall cost to produce electricity.

Researchers also ran the numbers without considering environmental externalities and found natural gas to have the lowest LCOE for the majority of U.S., but wind still having the lowest cost across the Great Plains and in upstate NY. However, it is important to note that combined cycle natural gas plants and nuclear generation are sensitive to natural gas and carbon prices while wind and solar are not. Utilities are able to buy wind and solar at fixed rates, which ultimately protects consumers from potential increases in fuel prices.

Print Friendly, PDF & Email

There is an all too common misconception among policy makers, regulators, and power market participants that wind energy isn’t reliable, and that turbines can’t provide essential grid reliability services. In reality, wind turbines can provide many of the services needed for reliable grid operations, including voltage and reactive power control, frequency response, active power control, and voltage and frequency ride-through. That means wind energy can help boost the overall reliability of America’s electricity grid.

In fact, in some cases, wind provides these services better and more economically than traditional power plants, while in other cases conventional generators currently provide those services more economically. Now, a new report from Sandia National Laboratories, in collaboration with Baylor University, highlights the ways in which wind helps grid operators keep the lights on.

Harnessing wind’s rotational energy

The new report showcases the ability of wind turbines to provide some of these essential grid reliability services using the kinetic energy stored in the rotating wind turbine blades and drivetrain. Leveraging existing literature as well as operational data from a Vestas V27 wind turbine at the Scaled Wind Farm Technology (SWiFT) facility, researchers demonstrated that wind turbines have significantly higher amounts of accessible storage energy per megawatt than a synchronous generator.

Accessing this stored, rotational kinetic energy enables wind turbines to provide regulation, frequency stabilization, and other frequency management services for the grid. Frequency regulation is used to balance out fluctuations in electricity supply and demand that occur over seconds to minutes. Frequency stabilization services, like primary frequency response, are used to stabilize the system’s supply and demand balance in the seconds after a grid disturbance, which is typically the failure of a large conventional generator or transmission outage.

The researchers explain that a wind turbine is essentially two resources – a wind turbine and a flywheel storage device. A flywheel is a mechanical device that stores rotational energy where the amount of energy stored is proportional to the square of its rotational speed. By speeding up or slowing down a wind turbine, the stored rotational energy can be accessed to provide the grid services described above.

However, this comes at a cost. Accessing the rotational energy necessarily means that the efficiency of the wind turbine to generate energy decreases. And while the study doesn’t consider the economics of using the wind turbine’s flywheel capabilities to deliver grid services, it’s straight forward enough to understand that when the value of the grid service exceeds the value of the energy, it makes economic sense for the turbine to deliver the service.

Wind project operators can access stored rotational energy through turbine modulation, i.e. changing the turbine’s rotor speed. Unlike a traditional synchronous generator, wind turbines are decoupled from the grid system’s frequency, which means they need power controllers to determine when to access the stored energy. A synchronous generator spins at the same frequency as the grid, so it can automatically detect a change in frequency due to a sudden increase or decrease in power demand.

This decoupling presents an opportunity, as controllers can be designed to both respond quickly and release the energy efficiently. In fact, wind plants are at least 10 times faster than conventional power plants in changing their output in response to operator or market signals, and their response is far more accurate.

Renewable resources’ fast response is particularly valuable for arresting the frequency drop in the milliseconds and seconds following the loss of a large conventional power plant, and for preventing the power system from falling into a cascading outage.

For example, because of their fast and accurate response, wind plants in Texas already provide a large share of the downward frequency response when system frequency is high. And when wind turbines are already curtailed due to transmission congestion and other reasons, they often provide upward frequency response. As a result, the North American Electric Reliability Corporation has documented that the Texas power system’s frequency response is much better when wind output is high.

The controller can also be programmed to optimize the release of stored kinetic energy. In part because of this efficiency, and because the rotational speed of a wind turbine is not limited by grid frequency like that of a synchronous power plant, the ‘accessible’ amount of stored energy in a wind turbine is shown to be six times greater than a traditional generator, with essentially no efficiency loss, and up to 75 times greater at a 10 percent loss in efficiency.

Market reforms needed to properly value wind’s reliability attributes

Importantly, the research shows that wind turbines can access a portion of the stored kinetic energy and deliver grid services without sacrificing energy production. Consequently, the study concludes that “the wind industry is leaving money on the table, and the U.S. is overlooking a significant source of flexibility and resilience.”

A key part of the problem is market design – there is simply no market for many grid reliability services. Or, as the report notes, the markets are “inherently biased towards certain resources.” In many regions, market rules prevent wind plants from even participating in markets to sell these services. Developing the right price signals and participation models can help ensure these services are procured cost-effectively. This could be another way that well-designed markets deliver the most affordable and reliable electricity to consumers.

In some cases, it may also make sense for wind plants to sacrifice some energy production to provide grid reliability services, particularly as renewable resources grow to provide a larger share of the generation mix. In Colorado, for example, the utility Xcel Energy has been using wind plants to provide frequency regulation for many years, particularly when the wind output would have been curtailed anyway.

The Sandia-Baylor study is another confirmation of wind’s ability to deliver grid reliability services – often better and at lower cost than traditional resources. The study also highlights the need to rethink market designs to properly incentivize the delivery of these services and open the market to full participation.

500 Internal Server Error

The server encountered an internal error or misconfiguration and was unable to complete your request.

Please contact the server administrator, [email protected] and inform them of the time the error occurred, and anything you might have done that may have caused the error.

More information about this error may be available in the server error log.

Apache Server at Port 80

Print Friendly, PDF & Email

We’ve finished running the numbers, and the figures once again show an industry on the upswing. The third quarter proved to be an exciting one for the U.S. wind industry, with more projects under construction than ever before, record volumes of corporate power purchase agreements (PPAs), and seven states on their way to more than double their wind capacity.

AWEA released the U.S. Wind Industry Third Quarter 2018 Market Report this week, showing 612 megawatts (MW) of new wind capacity installed in the third quarter, bringing total capacity in the U.S. to 90,550 MW. That means there is enough wind power on the grid to supply the electricity needs of 27 million American homes, and much more is on the way.

Over 20,000 MW of new wind capacity under construction, another 17,000 MW in advanced development

The new wind project pipeline is currently about as big as it’s ever been. Construction activity reached a new record of 20,798 MW at the end of the third quarter, with construction underway on 107 projects across 23 states. For comparison, Texas currently has just over 23,000 MW of wind capacity. That means we’re currently building a Texas-sized amount of wind.

Another 17,167 MW of wind capacity are in advanced development, bringing total activity in the U.S. to 37,965 MW, a 28 percent year-over-year increase. Project developers announced 4,507 MW in combined new activity during the third quarter as projects totaling 2,180 MW started construction and another 2,327 MW entered advanced development.

Notably, seven states now have enough wind projects under construction or in advanced development to more than double their capacity to generate electricity from wind once completed. This includes heartland states with land-based wind under development—Arkansas, Nebraska, New Mexico, South Dakota, and Wyoming—as well as coastal states Maryland and Massachusetts, where offshore wind is poised to scale up.


Wind power’s low and stable prices continued to drive strong demand from utilities and corporate customers in the third quarter. This customer group signed up 945 MW of wind power in the third quarter, including first-time purchases by Smucker’s, Boston University, and Royal Caribbean Cruise Lines. Over the last several years, non-utility customers including major consumer brands, cities and universities have become a major source of demand for wind power. In just three quarters of 2018, non-utility wind energy customers signed contracts for more wind power capacity than any other year, for a total of 2,904 MW. Cumulatively, non-utility purchasers have signed up for over 10,600 MW of wind energy, which is more wind than in all of Oklahoma, America’s number two wind state.

Corporates aren’t the only ones looking to add more wind energy – utilities across the country have signed contracts for 4,645 MW so far in 2018, bringing total PPA volume for the year to 7,550 MW. PPA activity in the first three quarters of 2018 already exceeds total activity in each of the last four years.

More powerful turbines on the way

Wind turbine technology continues to improve, with manufacturers introducing more productive, higher capacity turbines. The third quarter saw the first orders for 4 MW land-based wind turbines, with announcements from turbine manufacturers Senvion and Vestas. These new turbines are nearly twice as powerful as the average wind turbine installed in 2017 and are capable of powering roughly 1,400 homes each. The preference for 3 MW and larger platforms is also growing. Currently, 30 percent of projects underway that have already selected a turbine model went with a 3 MW or larger platform. The choice of more powerful turbines is noticeable in lower wind resource regions such as the Great Lakes.

Be sure to check out the full report for additional details. You can see more state level facts from the third quarter in the AWEA state fact sheets, as well as a map of all online wind projects and U.S. wind-related factories on our website.