3. wind power mature market history and lessons by a. wasielke

8/9/2019 3. Wind Power Mature Market History and Lessons by A. Wasielke

1/12

Wind Power Mature Market: History and Lessons

Angelika Wasielke

The views expressed in this presentation are those of the presenter and do not necessarily represent those of the Asian Development Bank.


2/12

Development of Wind

Energy Capacity EU


3/12

Mature Markets - Germany

Angelika Wasielke


4/12

(1) high-quality calibrated instruments installed according to IECwind measurement standards, and

(2) covering each relevant region of the country. Wheneverpossible, base the search for locations on

(3) a mesoscale wind modeling of the country and

(4) the transmission grid map, and have experts to find good,representative sites in each region. After a year provided a short

(5) pre-feasibility evaluation for each location, with a

Wind Measurements Key for Success

(6) micro-scale WAsP wind modeling analysis, the governmentshould

(7) maintain the masts and instrumentation in place, maintainingmasts year after year and continued to collect data from the mastswithout moving them, so as to provide

(8) good long-term reference data for nearby wind projects.


5/12

Good wind resources are not on their own sufficient to ensurestrong wind energy development and reductions of the cost of windenergy.

Even fair pricing is not necessarily enough

Only countries that have set up an adequate enabling environment

Success Factors

- ,

political commitment, have succeeded in developing wind power.Their policies have been focused, not only on reducing costs and

improving revenues to increase profitability, but also on

reducing risks!


6/12

Policy Instruments

Analysis: the policy approaches resulting in the most significant growth of REmarkets are all characterised by:

A combination of different policies, rather than using a single policy, Long-term and predictable policy support, The use and adaptation of markets.

-

have the advantage of giving developers long-term stability and predictability andhave helped create three of the worlds largest wind energy producers. In theEuropean context, they have been more cost- effective than Quotas.

Tender-driven policies have major drawbacks and until now, there has been no

successful experience (in Europe) of tendering as the sole instrument of anationwide ambitious wind dissemination policy.


7/12

Policies on permitting and licensing and grid issues are critical. Ifobtaining all the necessary permits and licenses is a complex, costlyand uncertain process, investors can be deterred and projectprofitability jeopardized.

Grid access is of course critical to wind energy development, buteven when regulations giving grid access to wind farms are in place,many critical issues related to grids can remain including

Grid Issues

connec on e ays an c arges, ransm ss on c arges an grstability and ancillary services.

Another barrier is transmission availability. The best locations fornew wind plants are often in distant areas without close access to a

transmission line.


8/12

Preconditions for Success

A real commitment by policy-makers to develop wind energy;

A legitimate public authority to set rules and obligations and enforce them

in a way that will appear credible to investors;

A grid that has enough capacity and technical stability to accept largeamounts of wind energy without jeopardizing its security;

High electricity prices compared to which wind energy will be more easilycompetitive;

and a large enough commercial wind energy potential.


9/12

2 KEY QUESTIONS2 KEY QUESTIONS

1. What Makes a Wind Farm Investable?2. Dragon Capitals Toughest Decision Invest in wind farms -

Criteria for Investment Decisions

In Vietnam, orThailand?


10/12

Power Price andFeed-In Tariff

Tax Incentives

Vietnam Thailand

20 $Cent/ KwH 10 yearterm

4.5$ Cent/ KwH

Base Price, +$?

CIT Exempt 8yrs Import Duty + CIT (3ears minimum

ASSESSMENT BY COMPARISONASSESSMENT BY COMPARISONFINANCIAL


Local Bank loansterm/cost/riskappetite

Expert StrategicInvestors

Limited to 60%, 10yrs Limited risk appetite/ cost~%?

1 Expert Fund 1 Expert Fund - MBCDF

Manageable NegotiableExchange RateRisk


11/12

ContractEnforceability

Vietnam Thailand

1-3 3-6

Reliable Uncertain

ASSESSMENT BY COMPARISONASSESSMENT BY COMPARISON

Expert DevelopmentCompanies #

LEGAL


Company Licensing

Land Rights

Slow Effective

Very Difficult Effective

Well-defined 5 yrs ~ $ pricePPA Predictability


12/12

Contact: [email protected]

3. wind power mature market history and lessons by a. wasielke

Documents