Professional Documents
Culture Documents
April 7,
7, 2011
This publication was produced for review by the United States Agency
for International Development. It was prepared
prepared by Tetra Tech.
Tetra Tech
DLF Cyber City
Building No. 9B, 11th Floor
Gurgaon 122 002, INDIA
Tel: +91 124 473 7400
Fax: +91 124 473 7444
Tetra Tech, Inc.
4601 North Fairfax Drive
Suite 601
Arlington, VA 22203, USA
Tel: + 1 703- 387-2100
www.tetratech.com
Disclaimer
The authors views expressed in this publication do not necessarily reflect the views of
the United States Agency for International Development or the United States
Government.
EXECUTIVE SUMMARY
While over 11,807 MW of wind power installed (that is, commissioned) capacity have been
developed in India, the combined installed capacity of the remaining SARI/Energy countries
Pakistan, Bangladesh, Afghanistan, Nepal, Sri Lanka, Bhutan and Maldives is less than 40 MW.
The lack of a supportive renewable energy policy framework and knowledge of how to develop,
finance and build wind projects accounts for much of South Asias paucity of wind power
projects.
As the regions non-India project development pipeline grows to some 3,000 MW, the
likelihood of wind power projects moving into the construction phase will be influenced by at
least four factors:
The presence of supportive government policies promoting the development of wind power
(these include, for example, policies on access to wind resource data and ease of permitting
for wind masts)
Interest by developers
The availability of capital for wind power projects
Whether developers have access to sufficient knowledge and experience in wind project
development.
This third issue of the Energy Security Report white paper series is devoted to the
implementation of wind power projects in SARI/Energy countries. It was conceived by the
USAID/SARI Energy team as a result of discussions with energy sector policy makers in the
region, notably Maldives, Nepal, Pakistan, and Sri Lanka, all of whom are launching wind
programs. In addition, USAID sponsored a regional workshop, Supporting Wind Power Takeoff in the SARI/Energy Region, in September 2010 in Colombo, Sri Lanka, which brought
together developers, equipment supply firms, and other wind power stakeholders who
discussed the issues they are facing.1
This workshop not only resulted in an increased understanding of these issues but also moved key stakeholders
to take the first steps towards implementing wind farms in their countries. An additional outcome was progress
towards the development of national wind energy maps. Each country delegation worked with instructors and
other workshop participants to develop a high-level road map together with the Asian Development Bank
speakers. The highest priority actions for governments and donor agencies are to focus on improving wind
The paper provides policy and technical insights on the development process and
implementation guidance for onshore wind power projects for governments, project
developers and other stakeholders. It is intended to serve as a guide to current and upcoming
wind developers in the SARI region on how to navigate through the various technical,
commercial and policy issues involved in setting up a wind farm, both to spur development and
reduce development times.
The wind power project development process is highly involved, requires inputs from experts
across many disciplines, and can take a few years to complete (less if clear policies and
guidelines are in place). The project lifecycle is not set in stone it will vary for each country
and project site, but the basic steps outlined in this report are applicable for any developer.
This report is designed to provide information on a number of topics and hence, each section
can be viewed as a topic briefing and may be reviewed individually. The topics covered include:
The annexes provide additional information and checklists that are useful for project
developers and government agencies seeking to promote projects.
resource assessment and capacity development for government policy makers around policies and regulations to
foster project implementation.
ii
ACKNOWLEDGEMENTS
This report provides prospective developers, professional service organizations, and
government stakeholders with a picture of the complexities and steps required to develop a
wind project in South Asia. The impetus for this study came from two sources. The first was
India, which developed a wind industry only in the 1990s, but has now installed almost 10,000
MW of wind energy capacity and built an institutional infrastructure for wind that allows for
further growth. The second was the Asian Development Banks conference: Quantum Leap in
Wind Power in Asia: Context, Barriers and Objectives, held in Manila during June 2010. This
conference showed that proper project formulation results in much shorter development cycles
and strong investments.
The task team comprised Shri. V. Subramanian (Secretary General), Shri Manish K. Singh
(Secretary) and other staff from the Indian Wind Energy Association (InWEA); and Amit Dalal,
Ajay Jain, Michael Hajny, Mustafa Jamal, and Wynne Cougill (Tetra Tech ENE). The report
benefited from suggestions by members of the Asian Development Banks team, including
Jitendra Shah and Soren Krohn, as well as Pramod Jain of Innovative Wind Energy, Inc.
The team would also like to acknowledge the many wind energy specialists and practitioners
from Tetra Tech, Inc. and particularly, Ms. Anntonette Alberti, Vice President for Commercial
Energy, for sharing their insights, case studies and information that contributed to the
development of this document.
Special thanks to Srinivasan Padmanabhan, Senior Advisor Energy to USAID and the Regional
Program Director of USAIDs SARI/Energy Project.
Finally, the team members would like to express their gratitude to Ms. Bhakti Narang Bhowmik
of Tetra Tech for organizing and delivering the successful workshop Supporting Wind Power
Take-off in the SARI/E Region, which was held in Colombo, Sri Lanka, on September 22 - 24,
2010.
iii
iv
ACRONYMS
ADB
AEDB
AEP
BOO
BPTA
CDM
CDM EB
CFD
CER
CERC
CIGRE
CO2
CUF
DANIDA
DFIG
DNV
DPR
DSCR
EIA
EHV
EPC
FIT
GBI
GHG
GtZ
HV
IEA
IEC
High Voltage
International Energy Agency
International Electro-technical Commission
INR
IPP
Indian Rupee
independent power producer or project
IRR
JI
kV
kW
kWh
LDC
LKR
LVRT
m
MEASBET
MIGA
MNRE
MV
MW
NPV
O&M
OEM
ONGC
NOC
PCN
PDD
PERT
PLF
PMG
PPA
Exceedance probability
research and development
Regional Centre for Excellence in Micro-Hydropower (Nepal)
renewable energy
Renewable Energy Certificate
ROE
RPS
Rs
SARI/Energy
return on equity
Renewable Portfolio Standards
Indian Rupees, same as INR.
South Asian Regional Initiative for Energy
vi
SCADA
SIL
SMB
SO2
S3IDF
SWOT
TSO
TSP
TSU
Unit
UNFCCC
WAsP
WEG
WRA
WTG
vii
viii
CONTENTS
1.
Introduction / 1
1.1
1.2
1.3
1.4
2.
3.
4.
5.
Technology/Turbine Selection / 31
5.1
5.2
5.3
5.4
5.5
5.6
5.7
5.8
5.9
ix
5.10
6.
Grid Interconnection / 43
6.1
6.2
6.3
6.4
6.5
6.6
6.7
6.8
6.9
6.10
7.
Cost Structure / 55
General Parameters of a Wind Financial Model / 56
9.
Transmission / 44
System Impact Study / 46
Frequency Control / 47
Reactive Power Management / 48
Harmonics and Voltage Flicker / 49
Protection Scheme / 49
Metering and Communication Requirements / 49
Supervisory Control and Data Acquisition / 50
Balancing and Settlement Code / 50
Regulatory Requirements / 51
8.
Feasibility Report / 67
Detailed Project Report / 68
Preparing the Bid Document / 69
Evaluating Bids / 71
Appendices
A.
B.
C.
D.
E.
F.
xi
xii
Section 1
INTRODUCTION
This third issue of the Energy Security Report white paper series is devoted to wind power
project implementation in SARI Energy countries. It was conceived by the USAID/SARI Energy
team as a result of discussions with energy sector policy makers in the region, notably
Maldives, Nepal, Pakistan, and Sri Lanka, all of whom are launching wind programs. In addition,
USAID sponsored a regional workshop Supporting Wind Power Take-off in the SARI/E Region
in September 2010 in Colombo, Sri Lanka,2 which brought together such wind power
stakeholders as developers and equipment supply firms. This white paper also addresses many
of the issues raised at the workshop.
The papers main objective is to provide policy and technical insight on the development
process as well as implementation guidance for onshore wind power projects for governments,
project developers and other stakeholders. It I intended to serve as a guide to current and
upcoming wind developers in the SARI region on how to navigate through the various technical,
commercial and policy issues involved in setting up a wind farm, both spurring development
and reducing development times.
The Sri Lanka Sustainable Energy Authority (SEA) co-hosted this event and the Asian Development Bank provided
speakers, which drew some 55 attendees from government, developers and equipment suppliers, policy
organizations, NGOs and project sponsors in the wind power sector of SARI countries.
SARI/Energy recently completed two related studies: a report3 that identified barriers limiting
the development of new grid-integrated utility-scale renewable energy projects in South Asia
and proposed policies to mitigate these barriers; and, a reliability and stability study that
included wind power integration4 for the Ceylon Electricity Board (Sri Lanka). These reports
illustrate ways to overcome certain policy and project barriers.
The second SARI/Energy Energy Security Report was published in 2009. It contained a robust
analysis and evaluation of existing and recommended government policies for the promotion of
renewable energy development in SARI/Energy countries. The institutional issues are
particularly important in getting wind power projects off the ground. They include overcoming
the lack of well defined incentive structures, limited expertise and information, and other
obstacles that require concerted efforts. Although several successful models for promoting
wind through universally applicable policies are now available, the experience from a number
of countries shows that large-scale wind energy projects require a number of policy, regulatory
and utility initiatives to be executed simultaneously.
Another cross-cutting policy challenge is human resource development needed to spur a large
scale wind power development for several SARI/Energy countries. While the industry is ready
for a take-off, only India appears to have conducted a detailed assessment of the human
resource and training needs for personnel to support large scale wind project development.
This human resource can be employed directly in the industry (wind developers, turbine
manufacturing and assembly, engineering, O&M etc.) or involved through indirect means
(component manufacturing and materials supply, transport, software development, etc). A
national skills survey conducted in 2005 by The Center for Wind Power, WISE, Pune, assessed
six stages of wind power development: pre-siting activities, infrastructure, manufacturing,
assembly and erection, commissioning and O&M.
The survey found that the human resource need is influenced by three main factors:
Size of wind turbine larger machines are far more complex and need advanced
training
Advanced materials and communication equipment recent advances in metering and
communication interfaces indicate need for more advanced training and access to
technology platforms
Wind resource characterization/need for research and development adapting wind
power for local situations requires a skill in modeling, measurement and reporting
According to the survey, each MW of wind power generated about 5.7 direct jobs and 22.9
indirect jobs, with jobs related to O&M being in most demand. The survey concluded that the
main areas of policy support should be to increase applied undergraduate and graduate
3
Policy and Market Options to Increase Adoption of On-Grid Renewable Energy in SARI Countries, the report can be down loaded
from the SARI/Energy website, http://www.sari-energy.org/PageFiles/EnergyLibrary/SariResources.asp.
India Sri Lanka Submarine Cable Interconnection Project, Interconnection Reliability and Stability Study, October 12, 2010,
Chapter 12, Wind Penetration: Study of Frequency and Voltage Control Aspects; the report can be down loaded from the
SARI/Energy website, http://www.sari-energy.org/PageFiles/EnergyLibrary/SariResources.asp.
Stakeholders
Government
Department of
Renewable Energy
Power utility off-taker
Power project developers
Regulatory commissions
Equipment Suppliers
Chapter 5, 9
Chapter 1, 2
Appendices
Chapter 3, 4, 5, 6, 7, 8
This paper is designed to provide current data, insights and best practices to stakeholders on
each of the above subjects and issues. In addition, it outlines country-specific priorities and
international best practices in wind power project preparation and development to overcome
implementation challenges.
Increased incremental energy supply without adding to the fuel import bill. Wind projects
can reduce supply/demand deficits, which seriously constrain economic growth.
More economic opportunities in rural areas. Often, wind projects are located in remote or
rural areas. This presents coincident opportunities to increase economic growth and
support infrastructure development in these areas.
Lower carbon dioxide (CO2) emissions. For countries with a large number of thermal
plants, using wind to generate electricity reduces CO2 emissions for the utility and the
nation.
Reduced sulfur dioxide (SO2) emissions. SO2 is a byproduct of burning fossil fuels like coal
and oil. In the atmosphere it reacts with other chemicals to form compounds that can cause
acid rain and other air pollutants. By displacing a 20 MW fossil-fired plant, a 20 MW wind
project can cut SO2 emissions by 120 tons each year.
Reduced use of non-renewable energy. Wind is renewed every day as the earth heats and
cools. Every kilo Watt hour of energy generated by wind saves about one pound of coal.
Reduced land use. About 5% of a wind farm site is used for the turbines, equipment and
access roads. Existing land uses, such as farming and grazing, can continue unaffected.
Conventional electricity generation requires larger footprints to obtain the fuel (e.g.,
mining, pipelines, and transportation) and generate electricity (power plants).
The outlook for wind power in the SARI/Energy region looks especially promising. Many
SARI/Energy countries are facing
Figure 1. Wind Power Additions Worldwide
high costs to produce electricity and
have strong wind resources in close
proximity to their demand centers,
which strengthens the case for
large-scale wind power deployment
as a means to address long-term
energy security. In addition, these
countries are beginning to put in
place the right policies to support
their growing wind power sectors
(as Pakistan and Sri Lanka are doing)
and to complete high-level
assessments for wind power (as
Nepal and Bangladesh are doing).
Section 2
STATUS OF WIND POWER IN
SARI/ENERGY COUNTRIES
All SARI/Energy countries have strongly expressed their intent to harness their wind resources
for power generation. Many have completed the first phase in the development process (wind
resource mapping) and have made institutional announcements and enacted policies in
support of wind power generation.
Country
Afghanistan
National
Target
NA
Projects
Development
Advanced
Under
Announced
Initiated
Development Construction
0
0
0
0
Bangladesh
NA
2-3
Bhutan
NA
10
50
Maldives
NA
50
50
Nepal
NA
2-3
0.3
Commissioned
0.7
Pakistan
5,000
4,850
900
150
50
Sri Lanka
34
120
80
43
20
33
10,500
3,800
850
600
NA
11,807
India*
th
Current 11 Plan target and projects announced are from the Indian Renewable Energy Development Agency,
June 2010 (projects in India are often captive and not always announced in the public domain).
Source: Indian Wind Energy Association and Tetra Tech estimates, 2010.
Sri Lankas wind regime, which is located at the countrys west coast and central hills, appears
to be attractive, with wind speeds of 6-7 meters per second. A pilot wind power project was
launched in the southern region in 1999 with a capacity of 3 MW using five turbines. Three 10
MW privately owned and operated wind farms have been commissioned, and several more are
under construction or active development.
Despite these encouraging developments, the SARI/Energy region continues to face power
shortages and remains one of the most attractive markets for industrial- and utility-scale oilfired reciprocating engines. The industrial and commercial sectors in many SARI/Energy
countries remain large users of inefficient, expensive and imported diesel gen-sets, which they
perceive as the only way to guarantee reliable power for their operations.
Interestingly, several new policy incentives have been designed to spur the market for
renewable: renewable portfolio standards (RPS), renewable energy certificates (REC) and
generation based incentives (GBI).
RPS is a policy tool used to increase renewable energy generation by means of a cost-effective,
market-based approach that is administratively efficient. An RPS obligates electric utilities and
other retail electric providers to supply a specified minimum amount of customer load with
electricity from eligible renewable energy sources, like such as wind, solar, biomass, and
geothermal. The goal of an RPS is to stimulate market and technology development so that,
ultimately, renewable energy will be economically competitive with conventional forms of
electric power.
Unlike feed-in tariffs which guarantee purchase of all renewable energy regardless of cost, RPS
programs tend to allow more price competition between different types of renewable energy,
but can be limited in competition through eligibility and multipliers for RPS programs. Those
supporting the adoption of RPS mechanisms claim that market implementation will result in
competition, efficiency and innovation that will deliver renewable energy at the lowest possible
cost, allowing renewable energy to compete with cheaper fossil fuel energy sources.
While RPS is a mandate on a utility to purchase renewable energy, renewable energy credits
(REC) is a method for accounting for RPS obligations. REC is a tradable certificate for each unit
of electricity (typically one MWh) that is produced using renewable sources. RECs are sold in an
exchange, thereby monetizing the renewable property of energy generation. Typical buyers
are of RECs are utilities that are unable to meet their own RPS requirements or companies that
wish to offset their carbon footprint. In most cases, the power purchase agreement (PPA)
defines a bundled price for energy and the REC, in which case the buyer of electricity (in this
case, the utility) owns the RECs. In order to verify achievement of RPS standards, the utility
uses RECs as an accounting method. The prices of REC in an exchange is usually very volatile,
therefore it increases the uncertainty of revenue.
GBIs are a method of incentivizing the production of energy from renewable sources. GBI
takes the form of a tax credit or a direct payment for each unit of electricity produced from
Supporting Wind Power Take-off in the SARI/Energy Region
10
renewable sources. When GBI is in the form of a tax credit (e.g., the production tax credit
system in the U.S.), the ownership structure becomes complex because tax equity partners are
brought in to monetize tax credits. During tough economic times, the tax liability of equity
partners is significantly reduced, which creates a shortage of funds for renewable energy
projects.
In most situations, the Feed-in Tariff (FiT) based pricing of renewable energy is the most
efficient because it provides a transparent price for a unit of electricity for investors.
Determining the level of FiT and changing it over time requires complex econometric modeling
and forecasting. Many SARI/Energy countries are using FiT principles to launch wind power
programs.
Increasingly, policy makers and developers are realizing that wind power does not create the
large-scale and far-reaching environmental and societal impacts of large thermal plants, but
through a carefully designed policy package can provide a competitive, environmentally clean
solution in many cases.
The workshop not only resulted in an increased understanding of these issues but also moved
key stakeholders to take the first steps towards implementing wind farms in their countries. An
additional outcome was progress towards the development of national wind energy maps.
Each country delegation worked with instructors and other workshop participants to develop a
high-level road map together with the Asian Development Bank speakers. The highest-priority
actions for governments and donor agencies are to focus on improving wind resource
assessments and capacity development for government policy makers around policies and
regulations to foster project implementation.
A policy road map template was provided to all government participants from the eight
SARI/Energy countries and the group was asked to provide information on the elements shown
in Table 3.
11
Interagency cooperation
Centralized authority to plan
Refine project technology
Accelerate local supply chain
Set firm targets
Develop human capacity
Work on community level
Fair access to grid
Ensure integration into grid
Assess wind resource
Government policy makers were also asked for suggestions on any additional areas of technical support
for USAID and other donors, including the ADB.
Figure 2. Summary of the Outputs from the Country Wind Project Road Map Sessions
12
13
14
Section 3
WIND POWER PROJECT
LIFECYCLE
The wind power project development process (Figure 3) is highly involved, requires inputs from
experts across many disciplines, and can take a few years to complete ((less if clear
cle policies and
guidelines are in place). While the
he project lifecycle will vary for each country and project site,
all developers will need to address the basic 12 steps outlined in Figure 33.
Figure 3. Overview of the Wind Project Development Process
Source: Tetra Tech EC, Inc. Wind Energy Services and Tetra Tech ENE, 2010.
Supporting Wind Power Take-off
off in the SARI/Energy Region
15
While all twelve steps are essential, the order of a number of steps can vary, depending on the
project countrys specific rules and regulatory requirements.
Step 1: Assess Wind Resource
The most important factor to consider in the construction of a wind energy facility is the site's
wind resources, and determining these will require a thorough wind resource assessment. To
put it simply, if the wind isnt there, the project isnt feasible.
Step 2: Initial Site Visit / Land Screening
Before investing more money in a project, once the wind resource assessment is complete, it is
important to visit the site to survey the topography and identify other potential risks to the
project.
Step 3: Establish Economics
A preliminary financial model that factors costs and revenues over the projects operational life
will give a picture of the projects returns and its economic feasibility.
Step 4: Secure Access to Land
Landowners, whether private or public, will expect to be compensated for any wind energy
development that occurs on their land. Royalty or lease agreements will need to be discussed,
as will the requirements for roads, transmission equipment, maintenance infrastructure and
turbines, all of which necessitate the use of heavy industrial equipment, and will require the
cooperation of landowners and in some cases, the local community.
Step 5: Transmission Access
A critical issue in keeping costs down in building a wind farm is minimizing the amount of
transmission infrastructure that must be installed. Therefore, availability and access to existing
lines should also be a consideration in site selection.
Step 6: Environmental Impact Assessment
This assessment is needed to demonstrate that there will be no unacceptable, adverse
environmental change brought about by the project.
Step 7: Power Contract / Power Purchase Agreement
Even before investing in a bankable wind resource assessment, a developer should secure
tentative commitments from one or more buyers for the wind plants output over the 10 to 30
years of its operational lifetime. Further down the line, a power purchase agreement (PPA)
that balances risks fairly between the developer and off-taker will need to be negotiated.
Step 8: Acquisition of Required Permits
Many social and environmental factors need to be considered in wind project development.
The developer should be familiar with the regulatory (and political) environment to ensure that
the required permits can be acquired without excessive delay or cost.
16
Describing a loan for which there is a co-signer. That is, if the borrower defaults on the loan, the cosigner becomes legally liable for repayment. Thus, in addition to any collateral that may secure the loan;
the lender is further protected from default by the existence of the co-signer. No matter what risk event
occurs, the borrower or its guarantors guarantee to repay the debt.
Supporting Wind Power Take-off in the SARI/Energy Region
17
As regional developers become more familiar with wind technology, the need to understand
the process steps required to implement a project that produces the desired energy becomes
important. Successful development of a wind project requires a number of complex steps and
stages, particularly in the early stages of the development process. Therefore, it is necessary to
understand the project workflow process as described in Figure 4.
Land Screening
Public/Government
Acceptability Screening
Environmental/Cultural/
Engineering Screening
Conceptual Layout
Engineering Fieldwork/Constructability
Considerations
Constructability
Considerations
Engineering, Constructability,
Environmental, Wind, & Land Owner
Review
Final Horizontal Layout
Final Horizontal Layout
Federal
Permitting
State/Local Environmental
Review/permitting
Continued
Engineering Support
Land
Interconnection
Restoration
Monitoring
Operations
18
Section 4
SITE SELECTION AND WIND
RESOURCE ASSESSMENTS
Site selection is critical first step in the development cycle. A properly executed wind resource
evaluation at a given site is crucial in correctly projecting turbine performance at that site.
This process begins by consulting regional wind maps to assess sites and locations. These maps
are generated by the countrys own national meteorological service or renewable energy body,
or by organizations like the National Renewable Energy Laboratory (NREL) in the US (available
at: http://www.sari-energy.org/PageFiles/What_We_Do/wwd_solar
WindResourceAnalysis.asp) or the United Nations Environment Programme through the Solar
and Wind Energy Assessment Project (available at: http://swera.unep.net). These maps have
been used for initial resource assessments and are typically useful at the strategic level.
Although they are helpful in finding sites, these maps are generally not accurate enough to
conduct energy calculations at the project level or be used to obtain project financing.
The single-most important characteristic of a wind farm site is the wind speed, and therefore,
the formal energy prediction for a utility-scale wind farm must be modeled on data collected at
that specific site.
The commercial value of a wind farm is highly dependent on energy yield, which in turn is
highly sensitive to wind speed. Therefore, a change in wind speed of a few percent makes an
enormous difference in financial terms for both debt and equity. Thus, every effort should be
made to maximize the duration, quality and geographical coverage (extent) of data collection
across the wind farm site. In the majority of cases, the resource measurement and analysis
program are the responsibility of the wind project developer. The developer must provide a
robust prediction of the expected energy production over the projects lifetime.
During prospecting, the energy production of a wind farm can be predicted using methods such
as the Wind Atlas Methodology within the Wind Atlas Analysis and Application Program
(WAsP), which uses only off-site data from nearby meteorological stations. However, when the
Supporting Wind Power Take-off in the SARI/Energy Region
19
data from nearby stations were taken only at low elevations (e.g., 10 m) or the stations are
located far from the site, such analyses are generally used only to assess the initial feasibility of
wind farm sites. It is also possible to make predictions of the wind speed at a site using a
numerical Wind Atlas Methodology based on a data source such as the re-analysis Numerical
Weather Model data sets. Again, such data are usually used more for feasibility studies than
final analyses.
The analysis for a wind resource assessment described in this section assumes the availability of
on-site wind speed and direction measurements from a relatively tall mast. Figure 5 presents a
simplified view of this process.
In reality, it will also be necessary to also iterate the turbine selection and layout design
process, based on environmental conditions such as compliance with electrical grid
requirements and turbine noise levels, and commercial considerations associated with
contracting for the supply of the turbines and detailed turbine loading considerations.
20
Where:
P = power in watts (746 watts = 1 hp) (1,000 watts = 1 kilowatt)
rho = air density (this is ~1.225 kg/m3 at sea level, and decreases as altitude increases)
A = rotor swept area, exposed to the wind (m2)
Cp = Coefficient of performance (.35 for a good design, .59 {Betz limit} is the maximum
theoretically possible)
V = wind speed in meters/sec
Ng = generator efficiency (80% or possibly more for a permanent magnet generator or
grid-connected induction generator)
Nb = gearbox/bearings efficiency (as high as 95% for a good design).
The practical energy production is computed by mathematically merging the statistical profile
of wind speed with the power production curve provided by the manufacturer.
22
Anemometry Mast
A typical mast will have a number of anemometers (devices to measure wind speed) installed at
different heights on the mast, and one or two wind vanes (devices to measure wind direction).
These will be connected to a data logger, at the base of a mast, via screened cables. This whole
system is usually either powered by a battery or a small renewable energy (RE) system (solar
and/or wind). Air pressure measurement at the site is desirable but often not essential. Masts
can also have a modem or satellite link so wind data can be downloaded remotely.
Number of Masts
If the wind farm site is located on complex terrain, it will likely require multiple masts to
accurately measure the wind regime across the site, especially for a medium size or larger
project (>20 MW). On simple, flat terrain, a single mast will usually suffice.
Height of Masts
Wind speed increases with height above ground, which is why it is important to try to measure
the wind speed as close to the turbines hub height as possible. Where a near-hub height
measurement is not available, the wind shear profile (which describes how wind speed
increases with height at a given site) can be estimated in order to extrapolate using lowerheight measurements. Uncertainties are created when extrapolation is used, so efforts should
be made to ensure the gap between measurement height and hub height does not exceed 25%.
The costs of masts rise with height. Tilt-up guyed masts can be raised as high as 60-80 m.
Above that, cranes become necessary to hoist the masts and this increases costs considerably6.
6
Met-masts are made of thin aluminum tubes, they are tilted up and use guy wires for support. This is the cheapest configuration.
Taller means risk of bending of these thin towers. Instead of winch, cranes are used.
23
Seasonality
Because wind is subject to seasonal variation, 12 months of wind data are an absolute
minimum requirement so that seasonality patterns are captured. A wind rose is a way to
graphically represent wind speed and direction together (Figure 6). Wind farm design is highly
dependent on what the wind rose shows. If the wind is highly unidirectional, the turbines may
be configured in tightly packed rows perpendicular to the wind. However, if the wind blows
from multiple sides for long durations, the turbines should be uniformly spaced in all directions.
Figure 6. Wind Power Rose
24
Year-on-Year Variability
Wind speed can vary significantly throughout the year (Figure 7) and from one year to the next.
Hence, having wind speed data spanning a longer duration improves the energy production
estimate.
Figure 7. Typical Monthly Wind Speed Pattern
4.5
4
3.5
3
2.5
2
1.5
1
t
Se
pt
em
be
r
O
ct
ob
er
No
ve
m
be
r
De
ce
m
be
r
Au
gu
s
Ju
ly
Ju
ne
ay
M
Ap
ril
Ja
nu
a
ar
ch
0.5
0
ry
Fe
br
ua
ry
Months
Other Parameters
There are few parameters that have a direct or indirect impact on energy estimation. These
can be broadly considered as follows:
25
4.3
Availability of Infrastructure
Land
To acquire land with potentially economic wind resources is a major aspect of wind power
project development. It is essential for a project developer to get clear-title (litigation-free)
land for smooth project operation. Typically there are two types of land available for project
developers: private land and government land. Private land can be selected on a point basis
subject to the consent of the owner of the land. Typically, private land is bought or leased by a
developer. Government land is further categorized as forest land and revenue land, which is
typically leased to developers for certain stipulated time periods. Usually lease periods are
more than the life span of a wind power project.
Supporting Wind Power Take-off in the SARI/Energy Region
26
Power Evacuation
Land availability, along with the wind resource, will determine the size of the wind power
project that can be developed at a particular site.
Electricity generated at the turbine location needs to be transmitted to the substation. For this,
developers usually establish an internal grid network at a lower voltage level; at the substation
level it is stepped up to the appropriate state/province/national voltage level. The next step is
checking the availability of the nearby grid for evacuating power and checking the possibility
and viability of laying the evacuation line from the wind project to the nearest grid substation.
The length of the evacuation line and the total wind power project capacity at the site
determine the technical details for the evacuation line (such as the voltage level and type of
conductor). Since transmission loss is expected during electricity transmission, a very precise
material selection and line design are necessary to optimize the installation cost, maintenance
cost of the evacuation network, and transmission loss.
Accessibility
Accessibility is a very important aspect of developing any wind farm project. A detailed survey
is necessary before considering site development. It is often essential to obtain information on
the curvature of roads, slope of terrain, type of approach roads, and type of soil, etc., to avoid
logistical delays. It is also useful to study rain patterns, as there might be cases when there is
sufficient infrastructure available and the site cannot be assessed due to heavy rains delaying
commissioning schedules.
Permissions Required
Various permissions are required at different project stages; because they vary from region to
region and country to country, they cannot be generalized. Typically, the following permissions
are considered during project execution:
Approval of site
Clearance from the Ministry of Environment and Forests
NOC (no objection certificate, a permit) by the state renewable energy department
NOC by the transmission company
Clearance by the aviation department
Statutory local clearances from municipal corporations, telecom, defense, etc.
Projects need transportation permits
Construction permits
Grid connection approval.
In summary, the wind resource assessment and estimates of annual energy production and the
associated uncertainties are critical for obtaining financing. While the vast majority of projects
Supporting Wind Power Take-off in the SARI/Energy Region
27
in South Asia are balance sheet financed, a move to project financing for large projects is likely.
Hence, the lender will require a financial model with multiple estimates of energy production,
or exceedance cases. The mean estimated production of the project (P50) may be used to
decide on the size of the loan, but in most cases a value lower than the mean (for example P84
or P90) is used. Figure 8 shows the central position taken by the wind resource assessment
step.
4.4
Lightning
The occurrence of lightning strikes to the candidate site needs to be estimated. Such quantities
as lightning events per year, lighting strikes per event, and magnitude need to be included in
the technical specification for the WTG so that the supplier provides adequate protection.
Earthing (that is, grounding) and bonding provisions need to be included in the construction of
the tower and the foundation.
Corrosion
The nature and the degree of air borne corrosion at the candidate site should be understood
and quantified. Appropriate language needs to be included in the technical specification for
the WTG and the local electrical grid equipment at the site.
Sea salt in the air may be the most common corrosive agent in the area, but there may be
others if the candidate site is downwind of an industrial area, power plant, or city.
Earthquake
The nature and frequency of earthquakes at the candidate site should be assessed. This affects
both the structural design of the WTG and the foundation.
Soil and Foundation
The nature of the soil at the candidate site affects the foundation design and affects the project
cost. The nature of the soil is also a factor in the Earthing for lightning protection.
Major Wind Storms
The frequency and the magnitude of major wind storms at the candidate site needs to be
assessed. Though the WTG will not be operating during a major storm the structure is
expected to survive the storm.
Icing
If icing can occur at the candidate site then icing should be addressed in the technical
specification for the WTG and its foundation.
28
Figure 7: Sample Wind Power Developers Steps Involved in Wind Resource Measurement and Tasks Required Prior to Financing
Greenfield Activities
and Pre-project
Planning
Procurement
of Manufacturer
and EPC
Contractor
Wind Resource
Assessment
Project
Monitoring
Synchronization
Sale of
Electricity
Project Monitoring
Synchronization
Sale of Electricity
WTG Stabilization
Quality Check
Safety
29
30
Section 5
TECHNOLOGY/TURBINE
SELECTION
Electricity is generated when fuel is used to turn a turbine that drives a generator. Wind power
is no different, except the fuel is wind a free, clean and limitless fuel source.
The concept of harnessing wind energy is not a new one. Windmills employing a rotor driven
by wind power have been used for centuries for applications such as grinding grain or pumping
water. While this basic concept of harnessing wind power remains unchanged in todays multimegawatt and multi-million-dollar wind turbine, the modern wind turbine is in other ways a
vastly different and far more advanced machine. It must generate reliable, economical, highquality and network-frequency electricity with virtually no attendance and little maintenance,
continuously for a period in excess of 20 years.
In addition to becoming more efficient, reliable, and economical over time, wind turbines have
most visibly grown in size, from a rotor diameter of 15 meters in 1980 to around 128 meters
today for the largest turbines, corresponding to an increase in nominal power output of over
16,000%. Turbine efficiency has dramatically improved during this period from advances in
design and engineering. Figure 9 shows the scale of wind power development.
In 2007, MW-class turbines (capacity 1 MW) captured over 95% of the market share, leaving
less than 5% for smaller machines. Within the MW segment, turbines with capacities of 2.5
MW and upwards are becoming increasingly important, including for on-land use. The market
share of these largest turbines grew 20 fold between 2003 and 2007, from 0.3% to 6%. While
there continues to be demand for ever-larger turbine designs, especially in the off-shore
market, the focus for the on-shore market has shifted towards increased volume supply in the
1.5 to 3.0 MW range.
31
The top-ten global manufacturers of wind turbines (using 2007 global market share) and the
design choices of their flagship models are presented Table 5; Table 6 shows comparable data
for South Asia.
Market
Share
Model
Drive
Train
1
2
Vestas
GE Energy
22.8%
16.6%
V90
2.5XL
3
4
5
6
7
Gamesa
Enercon
Suzlon
Siemens
Acciona
15.4%
14.0%
10.5%
7.1%
4.4%
G90
E82
S88
3.6 SWT
AW119/3000
8
Goldwind
4.2%
REpower750
9
Nordex
3.4%
N100
10
Sinovel
3.4%
1500
(Windtec)
Source: Indian Wind Energy Association, 2009
Diameter
(m)
Geared
Geared
Power
Rating
(kW)
3,000
2,500
90
100
Tip
Speed
(m/s)
87
86
Geared
Direct
Geared
Geared
Geared
2,000
2,000
2,100
3,600
3,000
90
82
88
107
116
90
84
71
73
74.7
Asynchronous
PMG
converter
DFIG
Synchronous
Asynchronous
Asynchronous
DFIG
Geared
Geared
Geared
750
2,500
1,500
48
99.8
70
58
78
NA
Induction
DFIG
NA
Power
Conversion
32
Capacity
(kW)
Model
Rotor
Diameter
(m)
Hub Height
(m)
Cut-in
Wind
Speed
Vestas Wind
Technology
India Pvt Ltd.
Elecon
Engineering
Company Ltd.
Enercon (India)
Ltd.
1650
V-82
82
70 / 78 / 80
600
T600-48
48
800
E-48
GE Wind Energy
India,
Pioneer
Wincon Pvt Ltd.
Suzlon Energy
Ltd.
Shriram epc
Ltd.
RRB Energy Ltd.
Southern Wind
Farms Ltd
Regen
Powertech Pvt
Ltd.
Kenersys India
Pvt Ltd.
WinWind
Power Energy
Pvt Ltd.
Global Wind
Power Ltd
3.5
m/s
Cut
Out
Wind
Speed
20
m/s
Rated
Wind
Speed
(m/s0
14
m/s
Survival
Wind
Speed
(m/s)
52.5
50/55/60
3.5
m/s
22
m/s
11.5
m/s
55.3/55.8
m/s
48
75
53
73/75
70.5
64.7/85
750
GE 1.5sle
el
W755-48
48
50
1500
S82 V3-1500
82
78
2100
88
80
250
Suzlon S88
V3A-2100
SEPC 250 T
4.0
m/s
4.0
m/s
4 m/s
28.5
41.2
4 m/s
500
V39-500
47
50
600
47
50
225
Pawan
Shakthi- 600
GWL 225
29.8
45
1500
V 77
76.84
80
4.0
m/s
4.0
m/s
4.0
m/s
3 m/s
25
m/s
25
m/s
25
m/s
25
m/s
20
m/s
25
m/s
23
m/s
25
m/s
25
m/s
25
m/s
22
m/s
14
m/s
12
m/s
12
m/s
14
m/s
14
m/s
14
m/s
14
m/s
14
m/s
16
m/s
15
m/s
11.8
m/s
---
E-53
2.0
m/s
3.0
m/s
4 m/s
2000
K82
82
80
3.5
m/s
4 m/s
25
m/s
20
m/s
---
---
11.5
m/s
---
3-4
m/s
25
m/s
---
60 m/s
1500
1000
WinWinD 1
MW
60
70
750
NORWIN 750
47
65
57 m/s
----52.5 m/s
59.5 m/s
58 m/s
56 m/s
70 m/s
60 m/s
52.5 m/s
33
77
65
3 m/s
30
50
4 m/s
25
m/s
25
m/s
---
10.6
m/s
14
m/s
----
Today in India, wind turbines typically range from 250 kW to 2100 kW; they are installed in
locations compatible with the required wind speed of the turbine. In terms of turbine
technology, the Indian market has many variants with different capacities, including:
Gearless technology, where the wind turbine is coupled with a synchronous generator
and the power generated is fed through an electronic inverter system
Conventional gearbox technology with two winding induction generators; at low wind
speed the first winding kicks in and at high speed the second winding induction
generator produces power
A single winding generator for the entire range of wind speeds
Turbines tailored for a low wind regime, which is otherwise classified as: class I > wind
speed ranging over 10 m/s; class II > wind speed ranging between 8.5-10m/s, and class
III > between 7.5-8.5 m/s and class IV > is less than 6 m/s.
The process of selecting the technology is called the techno commercial evaluation. The
developer should clearly know the purpose of his investment is it purely for generating green
energy, which will be used for captive consumption; is it purely for investment purposes; or is it
for investment and captive usage purposes? The technology selection can then be made to fit
the developers requirements.
For example, if the developer is making a purely financial investment, then the technology must
be evaluated on the basis of the equitys internal rate of return (IRR), which is relatively low
compared to other forms of renewable energy such as biomass or hydro. If the developers
appetite is large, then he or she may opt for more efficient, higher-cost technology to be
relatively assured of good turbine performance. It is only after this decision is made that one
can think of selection parameters, which is an important and time-consuming exercise. Here,
more attention must be paid to the technologys performance in terms of the plant load factor
(PLF) and grid conditions and availability. Some of the important issues to be considered in this
regard include the site characteristics in the location offered, whether the grid is available for at
least 92-95% of the time, and the past performance of the grid.
Supporting Wind Power Take-off in the SARI/Energy Region
34
The investor should also consider the credibility of the equipment supplier in terms of his
assurance for any technology failure, location disturbance, and operations and maintenance
requirements. The investor perhaps can look for some kind of insurance policy to safeguard
against force majeure situations. By and large, the main issue becomes the land on which the
project is to be situated. On making the first advance payment, the equipment supplier
qualifies to register the land title in the investors name. This activity results in the investor
having clear title and ownership of the land.
35
of wind speeds (rather than a location being chosen to match the design features of the wind
turbine). If the location is not suitable, the WRA could recommend a different location.
5.5 Constraints
Most wind energy resource studies start with a top-level theoretical resource, which is
progressively reduced through the consideration of so-called constraints. These are
considerations that tend to reduce the area that will actually be available to the wind energy
developer. For instance, these can be geographically-delineated conservation areas, areas
where the wind speed is not economically viable, or areas of unsuitable terrain. The areas
potentially suitable for development are sequentially removed from the available area.
36
routine civil engineering quality records. Careful testing at this stage is vital, if a good-quality
wind farm is to be delivered and maintained.
The availability of a wind turbine generator (WTG) is usually in excess of 95%. This means that
for 95% of the time, the turbine will be available to work if there is adequate wind. This value is
superior to values quoted for conventional power stations. It will usually take a period of some
six months for the wind farm to reach full, mature, commercial operation and hence, during
that period, the availability will increase from a level of about 80-90% after commissioning to
the long-term level of 95% or more.
Operation and maintenance costs include regular maintenance, repairs, spare parts and
administration. The O&M cost, which used to be just over 1 US cent per unit, have been
reduced to just over US cent or even less. Manufacturers over the years have aimed to
shrink this cost significantly through the development of new turbine designs requiring fewer
regular services, thereby reducing downtime. The trend towards manufacturing larger wind
turbines also reduces O&M costs per kWh produced.
By and large, the post-commissioning warranty and guarantee are essential to the smooth
running of the project. Most of the parts are covered under the manufacturers warranty,
which precisely means that at any point in time within the defined period when the
manufacturing defect surfaces, it will be repaired or replaced. The guarantee generally covers
the life of the technology. Warranty against design defects is another matter.
37
any obligation to refund any part of the amount already paid. He will also be at liberty to
pursue any other remedies available to him. However, this could be also be negotiated.
38
Capacit
y of
wind
turbine
(kW)
Annual
Generation
per turbine
(in 100,000
kWh)
Generation
In mln
kWh per
MW
Cost of
turbine
(in mln
Rs)`
PLF
%
Cost per
MW
(in mln
Rs.)
Cost
INR
per
kWh
`
Ranking
methods
D=C/B
F=D*1000/8760
G=E*1000
H=G/D
Cost
20.33
21.25
24.00
26.40
26.64
27.33
28.04
1
2
3
4
5
6
7
PLF
/B
A
600
B
800
C
225
D
250
E
1000
F
250
G
1650
PLF: Plant load factor
1.50
2.00
0.50
0.50
2.46
0.45
4.20
2.50
2.50
2.22
2.00
2.46
1.80
2.54
30.50
42.50
12.00
13.20
65.60
12.30
117.50
28.54
28.54
25.37
22.83
28.11
20.55
29.06
50.83
53.13
53.33
52.80
65.60
49.20
71.21
3
3
4
5
2
6
1
As Table 7 shows, WTG supplier A has the cheapest cost, while supplier G has the highest plant
load factor (PLF). The choice of technology will depend on the risk appetite of the
developer/investor, the business model they favor, and the returns they envisage.
The DSCR is a ratio used to analyze the amount of debt that can be supported by the cash flow generated from
the project. Ideally, this ratio should be more than the amount borrowed on an average during the tenure of the
debt.
Supporting Wind Power Take-off in the SARI/Energy Region
39
5
Methodology
Project Cost
Project cost per MW
Turnkey project cost for an 18.75 MW project
Interest during construction @ 1% of project cost
Preliminary and pre-operative expenses, processing fees, etc. @
1% of project cost
Total Cost of Project
Total Cost per Turbine 1250 kW
Means of Finance
Equity margin at 30%
Term loan from banks at 70%
Total
C
1
2
3
4
5
6
7
8
9
10
11
Project Details
Project capacity
Turbine capacity
Number of wind turbines
Generation per MW
Net generation per generator (after Inter-farm line loss @ 2.5%)
Total generation for the project
Plant load factor
Power price (Tamil Nadu)
GBI @ 6.2 M per MW translates into
CDM / CER credit (up to FY 2020-21)
Tariff escalation
Parameter (`)
18.75 MW
1.250 MW
15
2.24 MU
2.80 MU
42.00 MU
25.57 %
3.39
0.50 paise per Unit
0.50
0.00
D
1
2
3
4
5
6
7
8
B
1
2
3
956.25
62.50
Parameter (`)
51.00
22.77
1.49
2.33 : 1
1.50%
5.00%
0.25%
20% after 15 yrs
40
9 Project IRR
12.96 %
10 Equity IRR
18.13 %
GBI = generation-based incentive, MU = million units, MW = Megawatt, PU = per unit
INR = Indian Rupee
The selection of the equipment for the project depends on several factors, the most important
of which are:
Whether the equipment supplier has established a presence in the market and if so,
for how long?
What is the total capacity the supplier has installed in the market?
What is the performance history of the proposed equipment?
Has the equipment performed as promised by the manufacturer? Have any deviations
been recorded for performance, O&M, etc.?
Once the equipment selection is complete, the developer will move into the procurement stage
and begin project implementation. While individual project construction companies follow
their own implementation steps, it is important for the owner to recognize the individual steps
involved in the civil, mechanical and electrical work streams. Figure 10 shows a sample project
implementation flow chart.
41
Mechanical Work
Electrical Work
Excavation
Unit Substation
Metering Point
OHT line
R.C.C.
Tower Assembly
D.P. Erection
Line Survey
Earthing
D.P. Erection
Erection on Poles
Control Room
WEG Erection
Transformer Erection
Earthing
Conductor Stringing
Cabling Works
42
Section 6
GRID INTERCONNECTION
To ensure a reliable and secure supply of power to electricity consumers, the grid must be
planned, erected and operated efficiently. Grid connectivity standards, transmission planning
criteria, and the grid code define the guidelines for achieving optimal operation of the system.
Wind power is an intermittent power source that must be used when available. Electricity
generated from wind power can be highly variable from hour to hour, daily, and seasonally. By
its nature, a wind generator is a variable power device; the individual unit size of a wind
generator is very small, and in some cases older generators may also act as an inductive load
(that is, having a lagging power factor and requiring reactive compensation).
As a part of the power system, wind power plants must fulfill the requirements defined in the
grid code documents. Wind power integration must satisfy the technical needs of grid
reliability, security and quality. This section briefly describes the special requirements for wind
farm integration with the grid.
Construction phase of a wind project substation (Credit: PPM Energy / Tetra Tech)
43
6.1 Transmission
Transmission System
The electricity generated by wind generators, (see Figures 11 and 12) is transmitted to load
centers through transmission lines. To minimize transmission losses, a high-voltage (HV) or
extra-high voltage (EHV) transmission system is employed. Various levels of voltage
transmission are put in place with the help of transformers. Parallel operation of the lines of
the transmission system increases system reliability and minimizes transmission losses.
Substations, which are basically switching stations or switching yards, allow for effective
operation and maintenance. Most substations are equipped with a voltage step-up facility.
System energy accounting and protection are taken care of by current transformers, potential
transformers, relays, meters, etc. Circuit breakers, isolators, earth switches, lightning arrestors,
earthing systems, etc. are all substation equipment. These technologies enable the operation,
maintenance and protection of both transmission and distribution entities.
The transmission system is planned, and erected or strengthened, well in advance so that the
electrical energy generated is transmitted without constraint. In this case, it is desirable to
avoid wind power backing down for want of an evacuation system. The reasons behind this are
that in developing countries the transmission evacuation system may not be commensurate
with wind power growth, and wind power has to compete with conventional power for
evacuation preference.
For transmission lines that connect the wind farm pooling substation to the main grid system,
transmission planning criteria can be relaxed to minimize evacuation costs. Norms for surge
impedance loading (SIL) may also be relaxed, taking into account the distance between the
wind farm pooling substation and the main grid system. In addition, the need for adopting N-1
grid security can be addressed on a case-by-case basis.
The SIL of a transmission line is the MW loading at which a natural reactive power balance
occurs. Transmission lines produce reactive power (Mvar) due to their natural capacitance.
The amount of Mvar produced is dependent on the transmission lines capacitive reactance (XC)
and the voltage (kV) at which the line is energized. A transmission lines SIL is simply the MW
loading (at a unity power factor) at which the lines Mvar usage is equal to the lines Mvar
production. The line length is not a factor in the SIL or surge impedance calculations.
Therefore, the SIL is not a measure of a transmission lines power transfer capability, as it does
not take into account the lines length, nor does it consider the strength of the local power
system. The value of the SIL to a system operator is realizing that when a line is loaded above
its SIL, it acts like a shunt reactor absorbing Mvar from the system and when a line is loaded
below its SIL, it acts like a shunt capacitor, supplying Mvar to the system.
44
SIL specifies limits on loading the transmission lines. However, short lines (less than 100 km)
can be loaded more than 2.5 times the SIL. Wind power evacuation lines may be generally less
than 100 km. Therefore, lines can be designed for higher SIL
SILs, which helps minimize project
costs.
Supporting Wind Power Take-off
off in the SARI/Energy Region
45
The N-1 criterion (as per the Union for the Coordination of Transmission of Electricity Grid
Code) is a rule stating that elements remaining in operation after the failure of a single network
element (such as a transmission line, transformer or generating unit, or in certain instances a
bus bar) must be capable of accommodating the change of flows in the network caused by that
single failure.
To ensure grid security, using the criteria above, there may a need for the duplication of the
wind power evacuation system. Considering the poor capacity utilization factor (CUF) in the
case of wind power, the N-1 criterion may be relaxed to minimize project costs.
Applying the N-1 criteria also has maintenance implications. That is, single network elements
(as listed above) are also taken out of service for maintenance. The developer needs to decide
whether or not, or to what extent, the wind farm is to continue operation during maintenance
of the electrical system.
The N-1 criteria can be applied separately to the major parts of the electric power system: local
grid for collecting electricity, the step-up substation, and the transmission evacuation routes.
For example, it may not be justified to have a second transmission exit, but it may be justified
to have substation that can be maintained while the wind farm operates.
Transmission Tariff
A transmission system is needed to transmit electrical energy from the generator to the load
element. The transmission service provider needs sufficient financial resources for the
installation and proper upkeep of the transmission system. The required revenue is to be
collected via transmission charges that are collected from the transmission systems users such
as generators and distribution companies. Government-designated agencies may compute the
transmission tariff based on financial norms including capital cost employed, debt-equity ratio,
rate of return, interest on working capital, O&M charges, and depreciation cost.
46
To ensure reliable, secured quality power, a system impact study is needed to evaluate the
required reactive power compensation (this is to meet the grid codes requirements). Also, in a
market-based system operating environment, the regulator has to be satisfied with the level of
reactive power compensation claimed by the transmission service provider.
The installation of a low-voltage ride through (LVRT) for wind power plants is generally
recommended by the service provider. However, the service provider should demonstrate the
necessity of the LVRT. The need for a LVRT facility, the requirement of reactive power
compensation, power quality problems and the self-excitation issues attributable to wind
plants may warrant a system impact study.
Figure 13. Wind Power Penetration Levels in Europe at the End of 2007
47
wind power. However, if there is a deviation in the actual from the scheduled figure, WTGs will
be asked to pay penalty charges for deviating from the schedule. In India, WTGs are required
to pay unscheduled interchange charges as of 1 January 2011.
Ancillary Services8
For large-scale integration of WTG electricity to the grid and for improved grid operation, the
variable nature of wind generation must be supplemented by ancillary services. While the
power output from WTGs is variable depending on wind input, a grid operator needs a steady
output for smooth grid operation. Ancillary services can supply backup generation at the time
of need and absorb surplus power from the grid when wind power is in excess of demand.
Pumped storage hydro is one such example. In this case, the load dispatch center (LDC) must
enter into an agreement with ancillary service providers.
These are the services needed to support the power systems (that is, grids) operation, including maintaining
power quality, reliability and security (e.g., active power support for load following, reactive power support, black
start, regulating frequency during high wind power availability).
Supporting Wind Power Take-off in the SARI/Energy Region
48
Voltage Control
The LDC may direct a wind farm to curtail its reactive power draw-down or injection in case the
security of the grid or safety of any equipment or personnel is endangered. During wind
generator start up, the wind generator must ensure that the reactive power draw-down (inrush
currents in the case of induction generators) will not affect the grids performance.
49
A control area is an electrical system bounded by interconnections (tie lines), metering and telemetry, to control
its generation and/or load to maintain its interchange schedule with other control areas whenever required to do
so and contributes to frequency regulation of the synchronously operating system.
50
regulations). Based on the statement, the utility will make payments to the wind farm owners
within the time frame specified by regulatory agencies.
General
Name of the generating company
Name of power station, number of units, unit size, location
Generating company officer-in-charge for coordination of work
name and designation
Point of connection to intra-state transmission system, single-line
diagram of the proposed connection to be furnished
Name of transmission licensee with whom the systems connection
51
B
1
2
3
4
5
6
C
1
2
Inter-Connection
Generation voltage, step-up voltage for connection
Details of feeder protection on outgoing feeders to be connected to
transmission licensee system for evacuation of power
Start-up power requirement and black-start sequence and process
Requirement of power for construction and voltage
3
4
D
1
6
7
Generator
Metering system provided on lines indicating ownership and
responsibility for joint meter reading, sealing and calibration, etc. as
per metering code
Details of feeder protection on outgoing feeders
Copy of power purchase agreement /memorandum of
understanding for power purchase and transmission service
agreement for a evacuation by transmission licensee
Confirmation to the effect that all conditions outlined in the
connection agreements site responsibility schedule shall be
complied with by the user applying for a new connection or
modification of an existing connection
Detailed planning data (generation and substation) in compliance
with grid code for a new connection. For example, generator
impedances and inertias, transformer impedances, ground
resistance and fault capability.
Details of relay schemes provided for generator protection,
generator transformer protection and unit auxiliary transformer
protection.
Details of data acquisition and control system for unit being
interconnected.
Confirmation to the effect that standard planning data (generation)
are in compliance with the grid code for a new connection
52
53
54
Section 7
GRID CODE AND CONNECTIVITY
STANDARDS
A financial model must be run for a wind energy project for the purposes of investment analysis
and decision making, cash flow projections, raising debt funding, and performance monitoring.
Like any other financial model, basic cash flows are projected and various scenarios are built
up. Important financial ratios are computed, and profit and loss accounts and balance sheets
are projected. Thus, a financial model will be constructed before the investment is committed
and will be used during the life of a project to monitor its performance against the forecast.
55
Figure 14.
Wind Turbine Investment Cost Structure
1.2% 0.9%
1.2%
0.3%
3.9%
8.9%
1.5%
Turbine
Foundations
Electric installation
6.5%
Grid connection
Control systems
Consultancy
Land
Financial costs
75.6%
Road
56
Therefore, it may be worthwhile to take an in-depth look at the essential parameters that help
build financial models. The following sections throw light on the various parameters involved.
Merchant Sale
Under this arrangement, a bilateral agreement is signed between the project sponsor and any
other third party (typically not the Electricity Board). The project sponsor is paid at a rate
mutually decided upon by the two parties. The rate may vary depending on such factors as
time of day or demand, or the rate may be fixed.
Captive Consumption
Here, the investor generates electricity for in-house consumption. This model is well suited for
investors whose electricity consumption is projected to be large enough to absorb the energy
from a wind plant (mostly in manufacturing and industrial settings). In some cases, the project
may sell excess power to the grid, in which case the sponsor may receive an offset on his
monthly energy bills equivalent to the electricity supplied to the grid. If sales are to an
Electricity Board, any surplus generation will be paid for at the current tariff rate (in whichever
State or country the project operates). In India, the captive route for wind energy is the
second-most popular option, after merchant sale to the Electricity Board or distribution
companies.
57
58
on long-term reference data, and d) power production data of turbine provided by the
manufacturer is used to compute average annual energy production.
Also, expected yearly energy output depends largely on the PLF or CUF of the wind conditions
and the installed turbine. As an example, in India, per-MW CUF estimates can be made
available from the recently released CERC tariff guidelines. These guidelines have adopted the
approach of a zone-wise tariff, which assumes different CUF levels for different zones. These
are (on a per MW basis):
Annual Wind Power Density (W/m2)
200-250
250-300
300-400
CUF
>400
30%
20%
23%
27%
It should be noted that the annual expected output from wind power projects can be derived
from the above-mentioned CUFs. Note that the annual mean wind power density specified
above was measured at a height of a 50 m hub.
De-rating of Generation
Extreme operational conditions beyond the wind turbines design limits often result in the
underperformance of turbine components. Over the years, turbine output may fall below
expected generation. To reflect this fall in output and therefore revenues, a suitable de-rating
factor can be used in the financial model. Usually, de-rating is applied after 10-12 years of
operation. The gross generation of the turbine (P50) may be reduced by 1-2 % in absolute
terms due to de-rating. However, the actual de-rating will depend on actual operating
conditions and maintenance of the turbine.
Seasonality of Generation
A wind turbine will not produce a constant amount of energy throughout the year. For
example, in southern India, about 60% of annual energy generation may be achieved during the
six months of peak wind, whereas only 5% of annual energy output may be achieved during the
lowest two months.
If the financial model is prepared on a quarterly or monthly basis, this seasonal variation in
generation needs to be taken into account. If it is prepared on an annual basis, these variations
may be ignored.
59
Generation-Based Incentives
During December 2009, Indias Ministry of New and Renewable Energy (MNRE) announced the
new generation-based incentives (GBI) scheme, which was designed to encourage and aid the
entry of independent power producers in the Indian renewable energy market, which were not
seen as being as forthcoming as the other generation options. The key features of this scheme
are:
GBI will be available to all investors who do not chose accelerated depreciation
benefits for their projects
The incentive will be applicable for projects that plan to sell power to an electric utility
or captive consumption business. For captive consumption, the GBI will only be
available for that portion that is designated for sale to the Electricity Board or licensed
utilities
The applicable cap is Indian Rupees (INR) 6.2 million per MW (approximately US$
141,000 per MW);
These GBIs will co-exist with the accelerated depreciation benefit until the
announcement of a revised tax code, known as the Direct Tax Code, or the end of the
current five-year plan (Eleventh Five Year Plan, 2007-2012), or whichever is earlier.
60
Thus, revenue from GBI can be modeled as INR 0.50 per kWh generated from a wind project.
The payments will be made every six months and cash flow timings should be modeled
accordingly.
Carbon Credits
Wind projects are eligible for carbon credits under the Clean Development Mechanism (CDM)
of the Kyoto Protocol. If a project chooses to apply for CDM registration, it can forecast CDM
revenues depending on the number of certified emission reductions (CERs) the project is likely
to generate. However, as with RECs, the prices of CERs vary and it is difficult to forecast a
correct price. Moreover, the CDM registration process involves several steps and is time
consuming. CDM revenues are likely to materialize later in the life of the project.
Further, depending on the regulatory structure and PPA, part of the CDM revenues may need
to be shared with the electricity off-taker. If applicable, the project financial model should
make a provision for this. As per CERC, 100% of the gross proceeds from CDM benefits are to
be retained by the investor in the first year after the data on the projects commercial
operation are submitted. However, beginning in the second year, the investor is to give a 10%
share to the beneficiary, and 20% in the third year, until the share reaches 50%, after which
time the proceeds are shared in equal proportion between the parties.
61
Depreciation
In order to ensure the successful replacement of an asset at a future date, depreciation
allowances are accommodated in project costs. As per CERC, for computing depreciation, the
salvage value is assumed to be 10% and the depreciation is allowed for 90% of the total capital
cost. The depreciation rate for the first 10 years is assumed at 7% per annum and the
remaining depreciation is to be spread over the remaining useful life of the project.
Depreciation is chargeable from the first year of operation.
62
Debt/Equity Mix
In balance sheet funding, a strong project sponsor can obtain up to 70% of the project cost in
debt. The sponsor may opt for a lower level of debt depending on its balance sheet strength
and other funding requirements. In the case of off-balance sheet funding, the actual debt level
will depend on project cash flows. Typically, lenders will specify debt service coverage ratio
(DSCR) requirements for the P50, P75 or P90 generation levels, and will provide debt funding
accordingly. Therefore, in project financing, the debt level needs to be determined based on
forecast cash flows.
Sources of Finance
As mentioned above, the most common type of funding is a balance sheet funding, which is by
and large extended by financial institutions. The vast majority of projects in India have been on
balance sheet funding, with the bank setting the terms of finance.
Loan Tenure
A loan tenure of 710 years can be taken to be a reasonable approximation of the actual deal
structure for any wind farm project. CERC, for tariff determination, has assumed a loan tenure
of 10 years.
Moratorium
Generally left to the discretion of the financing body, the moratorium for a typical wind project
would be one or two years. The moratorium could include or exclude the payment of interest
during this period. Usually, a moratorium is provided only for capital repayments and interest
is payable during the moratorium period.
Interest
The interest payable will depend on market conditions as well as the projects financing
structure. Balance sheet funding will usually result in a lower interest rate, whereas off-balance
sheet funding will lead to higher costs. Further, the interest could be payable monthly,
quarterly, semi-annually or annually.
Supporting Wind Power Take-off in the SARI/Energy Region
63
For determining tariffs, the Indian CERC assumes the average long-term prime lending rate of
the State Bank of India prevalent during the year plus 150 basis points.
For example, apart from interest, the project sponsor may have to pay financing costs such as
processing fees for raising debt. Typically, these costs may be 1-2% of debt raised and will be
incurred at the time of debt drawdown and should be modeled accordingly.
7.2.7 Taxation
Applicable Tax on Profits
Taxes should be computed according to applicable tax provisions and should take into account
any tax holiday or other benefits available to the project. Further, tax computation may also
depend on the project sponsors tax structure and other tax obligations. For a simple analysis
without considering tax benefits which are useful for making comparisons between different
investment alternatives a fixed effective cash tax rate may be assumed to compute net profit
after taxes. For a detailed analysis, tax computations need to be carried out.
64
Profitability Index
The profitability index = Present value of cash inflows / Initial cash outlay.
Supporting Wind Power Take-off in the SARI/Energy Region
65
No.
1
State
Tamil Nadu
2
3
4
5
Maharashtra
Karnataka
Andhra Pradesh
Gujarat
10.85 (5.07)
7.92 (3.70)
7.49 (3.50)
7.62 (3.56)
Rajasthan
8.20 (3.83)
8.62 (4.03)
Madhya
7
Pradesh
9.31 (4.35)
8
Kerala
6.72 (3.14)
9
West Bengal
8.56 (4.00)
Source: Indian Wind Energy Association, 2010.
Exchange rate about 46.7 INR per 1 USD
Remarks
Fixed
In line with CERC guidelines
for the lowest wind zone
Applicable for 10 years
66
Section 8
FINANCIAL MODEL FOR WIND
POWER PROJECTS
The most important benefit of developing projects through a bidding process is a greater level
of transparency leading to overall reduction in risk involved for investors and developers. In
most cases, bidding processes facilitates investment, overall reduction in procurement cost,
and contracting with the best vendors with defined timelines. Hence, it is imperative to
understand the bidding requirements for developing wind power projects.
Bidding processes depend greatly on the energy contract and implementation model that is
prevalent in each country. In Europe, for example, the project developer or investor is
responsible for the identification and development of the site, land acquisition, micro-siting,
selection of the turbine manufacturer, the erection and commissioning of turbines, and the
development of allied infrastructure (e.g., roads, power evacuation facility). In India, the wind
turbine manufacturer also acts as the project developer and provides end-to-end solutions,
from the selection of the site until post-sales services such as O&M. This chapter reviews the
main analyses that a developer must undertake and prepare in order to submit a successful bid.
67
Brief information on the project: This section typically outlines the basics of the project:
site location, developer, financing institution(s), type of turbine proposed, total MW
capacity planned, etc.
2.
Detailed site information: This section usually deals with the exact location of the site
and its identification on a map, approach to the site (nearest transmission line, rail, road
and airport, etc.), types of flora and fauna in the vicinity, etc.
3.
4.
5.
Type of turbine model used: In this section detailed information is provided on the type
of wind turbine model considered for the project, the power curve, detailed technical
information on the product, and a technical validation analysis.
6.
Wind resource study: This section details the wind flow pattern, wind flow modeling,
suitability of the selected turbine type for the available wind resources, annual energy
production estimate, etc.
7.
Land details: Here, information is provided on the type of land proposed for the wind
power project, land availability (i.e., whether land is available from the developer or if it
is under procurement or in the approval phase (for government land), whether it is
purchased or leased, etc.).
68
8.
Micro-siting details: Details are provided on the exact location of the proposed wind
turbines (e.g., UTM coordinates, zone, elevation).
9.
10.
Policy and regulatory study: Details on the policy and regulatory environment are
provided in this section. It broadly highlights the tariff structure, tariff consistency,
policy stability, other incentives, tax benefits, structure for the sale of electricity, CDM
participation, etc. This section also lays out the permissions and approvals required to
set up a wind power project at a proposed location, and provides insights on the
timeframe during which the utility will make payments for the projects energy.
11.
12.
Financial outlook: The techno-commercial aspects of the project are detailed here to
determine its viability. These include the CAPEX, OPEX, working capital, debt/equity
ratio, interest rate, capacity factor, tariff, tax structure, and other incentives. The results
of this analysis are usually indicated in terms of the IRR, NPV, and/or DSCR.
13.
SWOT analysis: This section normally presents the detailed results of an investigation of
the strengths, weaknesses, opportunities and major threats (SWOT) to the project.
14.
Contingency analysis: This section assesses project risks under varying parameters
considered during the financial outlook analysis. Various possible combinations of
parameters are worked out to optimize the projects viability and to reach a realistic
conclusion on its economic outlook.
15.
Conclusion and salient features: This section concludes the DPR, highlighting the
advantages and disadvantages of the project and proposing a way forward for it.
The availability of a DPR mitigates technical and commercial risks for a wind power project and
helps the developer, investor and financial institutions in making an appropriate decision.
69
1.
Micro-siting and projection of annual generation. This involves a detailed study of the
site, and the type of land use and land cover, which will affect wind generation. If wind
measurements have been taken at the site, this component will also involve the
analysis of wind data, which will be used to estimate the annual energy generation
from the proposed project.
2.
Equipment supply. The technical parameters of the wind turbines are to be supplied
along with the project bid. This includes the power curve for the wind turbine and
specifications of other components such as the step-up transformer, generator, etc.
3.
4.
Erection and commissioning of wind turbines. The wind turbines must be erected
according to the micro-siting study recommendations, and the foundation for the
turbines must be built to meet the sites soil conditions. Further, the commissioning of
the project is to be undertaken as per practices prevailing in the country and those of
the local utility.
5.
Operation and maintenance of the wind project. If the turbine supplier provide free
operations and maintenance services for a limited period, the bid could provide for
these services after the free O&M period. This could also be designed for a fixed period
with an agreed-upon annual increase in cost.
In cases where bids are requested by prospective investors for wind projects that do not have a
fixed location or site, bidders are usually required to submit turnkey bids that detail projects at
a number of different sites. In South Asia, where turbine manufacturers are involved in project
development, this type of bidding is prevalent. In such cases, the turbine manufacturers take
on the full scope and provide a single bid price. This involves the identification of a site,
acquisition of land and necessary permissions, development of infrastructure, and the supply
and erection of turbines.
70
Technical Evaluation
In order to evaluate and rate the bids, evaluation criteria are prepared. These criteria can be
selected from the various parameters requested in the bid document. They can be broadly
divided into the following categories (arranged in descending order of importance):
Energy Generation
The important parameter here is the net annual energy generation from the proposed project.
The benchmark employed is usually the annual net generation per MW.
Turbine Parameters
These parameters are of two types: 1) those related to the turbines experience in the country
and its certification, and 2) those related to its salient features (electrical, mechanical, safety,
etc.).
The experience parameters of the turbine model offered could include the number of machines
installed in the country of interest and the number of years of experience with the turbine.
The features that may be included in the evaluation criteria are:
Status of Certification
The turbines offered must have a necessary type test certificate from the
appropriate authority in the country. If a country does not have such a certification
process, an international certificate can be considered.
Machine Size
Higher-capacity wind turbines offer optimum land use and lower O&M costs, and
hence are preferred.
Generator Type
Synchronous generators have definite advantages in terms of efficiency and thus are
preferred.
71
Geared/Gearless
The gearless machines have the highest energy capture rate and thus are preferred.
Startup
Machines with a soft start mechanism present fewer problems for the grid to which
the turbines are connected and hence are preferred.
Reactive Power Control
Turbines with dynamically varying control systems are preferred, as these systems
have better reactive power control than mechanically switched control systems.
Class of Machine
The class of machines is an indicator of whether the wind turbine is designed to
operate in a particular wind regime. The definition of the wind turbine classes is
given in IEC safety standard IEC 61400. The class defined by the annual average wind
speed at hub height is:
WTG class
I
Annual avg. wind speed (m/s) 10
II
8.5
II
7.5
IV
6
Depending upon the wind resource at the site, the wind turbine class is to be
evaluated and verified during the bid evaluation process.
Power Regulation
The active pitch control technique has better control on the output power from the
wind turbine and thus is preferred.
Bidder Experience
Bidders experience in installing wind farms in the country as well as their O&M capability can
be included as evaluation criteria.
Financial Evaluation
After the technical evaluation, the financial evaluation is undertaken. It involves examining the
bids that were selected in the technical evaluation. The best criterion for the financial
evaluation is a comparison of the per-unit costs of generation from the wind power projects.
72
Section 9
CDM FOR WIND PROJECTS
The United Nations Framework Convention on Climate Change (UNFCCC) was held in 1992 to
address the issues surrounding climate change and their implications. Developed countries,
referred to as Annex I countries in the Convention, were given emission reduction targets. The
Clean Development Mechanism (CDM), developed in 1997 at the Conference of Parties under
the UNFCCC, is a market mechanism to encourage the sustainable development of developing
countries, referred to as Non-Annex I countries, in a way that reduces greenhouse gas (GHG)
emissions.
The CDM, as defined in Article 12 of the Kyoto Protocol, allows a country with an emissionreduction or emission limitation commitment under the Kyoto Protocol (Annex I of UNFCCC) to
implement emission-reduction projects in developing countries. The CDM is the first global,
environmental investment and credit scheme of its kind, providing a standardized emission
offset instrument called a Certified Emission Reduction (CER).
In order to participate in the CDM, there are certain eligibility criteria that countries must meet.
All parties must meet three basic requirements: voluntary participation in the CDM, the
establishment of a national CDM authority, and ratification of the Kyoto Protocol.
The CDM is supervised by the CDM Executive Board (CDM EB) and is under the guidance of the
Conference of the Parties of the UNFCCC. The Executive Board supervises the operation of
CDM and has the final say on whether a project is approved or not. It also lays out procedures
and guidelines for CDM. The figure below outlines the procedures involved for a successful
CDM project.
73
Project Proponent
Applicant Entity
Designated Operational
Entities
Executive Board
& COP/MOP
Validation/
Verification
Designated National
Authority
Executive Board
Monitoring
Project Proponent
Verification/
Certification
Designated Operational
Entities
Executive Board
Insurance
Certified Emissions
Reductions
74
9.2 Baseline
The baseline is the emissions that would occur in the absence of the proposed CDM project,
and it must be developed for the project. A number of baseline methodologies have already
been approved by the CDM EB; they can be used if the project is similar to the project for which
the baseline has been approved. There is also an approved simplified methodology (ACM 002)
that most small-scale (less than 15 MW) wind projects can use. While the ACM 002 provides a
number of baseline options, the proposed project must provide baseline data related to
emissions from other generating sources, primarily thermal power generation, in addition to
generation data.
The development of CDM projects and their construction can occur in parallel. The best time to
initiate CDM project development is at the time of project conceptualization and certainly
before the investment decision. Table 10 provides the approximate timing for the steps
involved in CDM project development, up to the issuance of CERs.
Time Schedule
2 weeks
8 weeks
6 weeks
4 weeks
1 week
20 weeks
4 8 weeks
4 weeks
2 weeks
52 weeks
1 week
1 week
2 weeks
2 weeks
2 weeks
110 weeks
75
MW of installed capacity have applied for CDM registration. Of these, 1,665 energy projects
have been registered. In the SARI/Energy region, India leads wind power project registration
with some 104 wind projects now registered.
Wind power projects, like any other renewable energy project, have high initial investment
requirements with longer payback periods, which increase project risk. Various governments
have provided incentives to overcome this risk. Registering a wind power project as a CDM
project also provides additional revenue through the sale of CERs generated from the project.
A number of financial analyses have found that CDM revenue is capable of raising the return on
a wind project by 3-4%.10 Thus, CDM would help projects that fall just below the viability
benchmark in terms of IRR, to become viable.
10
http://cd4cdm.org/Publications/WindCDM.pdf
76
Figure 16. Number of Wind Power Projects Registered under CDM Annually11
90
80
70
60
50
40
30
20
10
Q
104
Q
304
Q
105
Q
305
Q
106
Q
306
Q
107
Q
307
Q
108
Q
308
Q
109
Q
309
77
Description
Cost
1
2
3
5
6
78
respectively, as compared to a CER, which is being traded at around 14 (the spot market price
on 5 September 2010).
On the other hand, the future of projects that were recently, or are currently being,
commissioned is beginning to look brighter under the CDM. Post-2012, such projects are likely
to be registered with minimum difficulty. In addition, the CDMs new Gold Standard is a
qualifying project standard with a focus on sustainable development. A Gold Standard project
is likely to earn a premium of at least 3-4/ CER above the usual CER prices.
While the opportunity for increased CDM support for wind projects is substantial clearly a
large proportion of the more than 5,500 MW of the development pipeline could benefit from
CDM the opportunity has not been fully explored by the regions governments and policy
makers. CDM remains a powerful tool to further augment private sector investment in wind
power and Power Ministries should fully support project registration.
79
80
APPENDIX A
WIND PROJECT DEVELOPMENT
CHECKLISTS
This appendix was adapted from Soren Krohns paper Wind Power Projects in Developing
Countries: Key Barriers and Solutions for Wind IPP/BOO Projects, September 2010.
81
82
4 Dominance of conventional
thermal power allows fuel
price risks to be passed onto
clients - or de facto absorbed
by public budgets
5 Electricity markets not geared
to wind
Barrier
1 20-year take-or-pay PPAs
unavailable or not allowed
2 Feed-in tariff may be
modified politically at any
time
3 No sustainability of tariff
scheme
83
Barrier
4 Creditworthiness of the
electricity offtaker is
inadequate
5 The fixed feed-in tariff or RE
bonus per kWh is inadequate
to ensure the profitability of
projects
Barrier
1 Unexpected permitting and
licensing requirements may
wreck an otherwise fully
developed wind project
84
Barrier
1 Exclusivity arrangements with
developers (often land
speculators) lock up valuable
high-wind resource land,
which remains undeveloped.
2 Land rent
85
86
If developers are to find sites on their own, then logically predevelopment work is the developer's responsibility, for example, in
a classic FIT system. In this case, however, it is necessary that the
legal and regulatory framework has been properly established,
dealing with all the issues listed in these tables (and more).
Bidding developers, not the electricity offtaker, should measure
wind on sites tendered for IPP/BOO projects, since the developer
takes the wind resource risk. An operational model for a voluntary
joint site measurement program for pre-qualified bidders has been
developed in Egypt for its 2,500 MW IPP/BOO wind program. This
model is now also being copied in Syria.
87
88
Barrier
1 Poor site area planning leads
to interference (wind shading)
between wind farms which
increases risks by decreasing
power output requiring
higher tariff for cost recovery
(this is a common problem in
very high-wind zones with
densely packed wind farms)
89
Barrier
2 Poor site planning in relation
to noise and shadow flicker
may cause problems with
neighbors and cause sites to
require re-planning.
4 Telecommunications
authorities may object to the
siting.
90
Barrier
1 Disagreement about which
party bears which risks in
IPP/BOO contracts
91
92
93
10
11
94
95
Construction risk
96
Firm PPAs of 20 (or at least 15) years with fixed prices are necessary
to obtain an acceptable electricity price.
97
98
APPENDIX B
THE SARI/ENERGY PROGRAM
B.1 Background
USAIDs South Asia Regional Initiative for Energy (SARI/Energy) program was launched in 2000
to promote energy security through increased trade, investment and access to clean sources of
power and fuel. Since then, SARI/Energy has reached out to more than 4,000 participants in
the region on clean energy trade, energy efficiency, rural energy supply, energy regulation,
energy statistics, and private sector involvement.
Activities under the SARI/Energy program include building institutional capacity, promoting
private sector and civil society participation in energy policy, and creating and strengthening
regional forums, networks and associations.
The long-term results that SARI/Energy seeks to achieve in the region are:
Together, these conditions will encourage trade in energy that will benefit both buyers and
sellers, contribute to economic growth throughout the region, and help mitigate the growth of
greenhouse gas emissions from the region.
More information on the SARI/Energy program can be found at www.sari-energy.org.
99
100
Regional Wind Power Workshop: Supporting Wind Power Take-off in the SARI/Energy Region
SARI/ENERGY hosted a three-day workshop on wind power in Colombo, Sri Lanka from 22-24
September 2010. The workshop built the technical capacity of the attending wind power
stakeholders on the practical aspects and steps involved in the development of a wind power
project from start to finish. Partners for this workshop included the Sri Lanka Sustainable
Energy Authority, Asian Development Bank, Indian Wind Energy Association, Tetra Tech, and
the National Renewable Energy Laboratory.
The workshop was attended by senior representatives of power ministries, utilities, and wind
power developers from the eight SARI/Energy countries (Afghanistan, Pakistan, India, Nepal,
Bhutan, Bangladesh, Sri Lanka and the Maldives). Interactive presentation sessions were
delivered by developers, equipment manufacturers, equipment procurement and construction
providers, wind power experts, banks that have experience in financing wind power projects,
and international financial institutions with programs promoting wind power.
The workshop included guided site visits to the two pioneering wind independent power
producer projects in Sri Lanka, and closed with an interactive exercise that brought together
diverse wind power stakeholders from each SARI/Energy country to develop a practical
roadmap for expanding the utilization of on-grid wind power in their country.
101
102
APPENDIX C
CASE STUDIES
SARI/Energy countries are earnest in their desire to harness their wind resources for power
generation. Many have completed the first phase in the development process (wind resource
mapping), and have put in place the institutional framework and enacted policy for promoting
wind power generation.
This appendix presents two case studies from India and Sri Lanka that provide insights into the
various methodologies being adopted in the South Asian region for appraising and developing
wind power projects.
Project Description
ONGC Ltd. floated a tender for the development of a wind power project in Gujarat on a
turnkey basis. After the technical and financial due diligence were completed, the project was
awarded to Suzlon Energy Ltd. This 51 MW
project has 34 wind turbines with a capacity of
1.5 MW each. The project development activities
included site identification, turbine supply, site
development, wind turbine erection,
development of electrical lines and substation for
the evacuation of power, obtaining necessary
permissions and approvals, and commissioning of
the project. The project was commissioned in
103
Equipment Package
The equipment package included nacelle assembly, tower, hub, blade set, power panel, DP VCB
yard, electrical lines, and 34 WTGs of 1.5 MW each.
Wind Regime
The annual average wind power density at the Jakhau site where the project is located is 311
W/m2 measured at the height of 50 m from ground level.
Grid Interconnection
The 51 MW wind farm is connected to the 220/33 kV substation situated at the project site.
This substation was developed as part of the wind project. The 220 kV Nani Sindhodi
substation is further connected, through a 220 kV line, to the substation of Gujarat Electricity
Transmission Company located at Nani Khakad, which is about 30 km from the wind project
location.
Costs
The total project cost for the 51 MW wind project was about INR 3070 million. The power
generated from the wind project is wheeled at different locations, 98 plants and offices of
ONGC, and used as captive power. Four percent of the power generated from the project is
deduced from the final unit adjustment, and put towards open-access charges (charges for
using the grid infrastructure). The 4% deduction also includes wheeling and transmission
losses. By using wind power at different locations, ONGC reduced its power purchases from the
distribution utility at the industrial rate for power, which is about Rs 6.00/kWh.
104
Incentives
The incentive mechanisms used by the projects are:
1. Concessional open access charges of 4%, whereas the normal charges are higher for
transactions involving conventional power (e.g., the transmission charge alone is about
INR 2,000/MW/day and 18% transmission losses).
2. There are special provisions for the banking of energy. In the case of wind power plants,
energy generation cannot be scheduled, often resulting in excess generation in real time
rather than demand in the case of captive use. However, the consumer gets credit for
all energy produced and sold on a monthly basis (i.e., the excess generation during the
month is banked in the grid).
Off-taker
Size, Location
Equipment Package
The equipment package included the
nacelle, blade, tower, anchor, rotor hub, and
electro-mechanical accessories for the tower and nacelle, as required by the customer.
Project Timeline
In order to complete the scope of work which included supplying the equipment, erecting the
project, commissioning, and supervising the civil foundation the projects timeline was
Supporting Wind Power Take-off in the SARI/Energy Region
105
originally envisioned to be six months. However, due to a few unforeseen events related to
logistics, it was completed in about eight months.
Wind Regime
The wind regime that prevails at the Puttalam site is class IIIA as per the IEC classification. It is
suitable for AE59-800 kW machines that were installed for this project.
Grid Interconnection
A 33 kV grid is connected to the wind farm to evacuate the power generated and a 14.7 km
transmission line has been constructed to the nearby substation in Kallady.
Incentive Mechanism
As a government policy initiative, the Ministry
of Power and Energy has set a target of 10% of
renewable power by 2015. Apart from the
tariff, which is attractive at present, there is no
other incentive mechanism available in Sri
Lanka to promote wind energy at this time.
Also, the Sri Lanka Sustainable Energy Authority
is responsible for issuing permits for setting up
renewable energy projects, including wind
energy, and for determining the tariff.
106
APPENDIX D
OFFSHORE INSTALLATIONS
It is expected that in the near future the majority of the wind farms in the region will be on
shore. However, with time and with experience the new wind farms may be offshore
installations. Wind farms in Europe have developed in this way, first on land, and then in the
sea. Therefore, this Report is developed primarily around on shore installations. This Appendix
provides insights into the opportunities and the challenges of offshore wind farm installations.
The other sections of this Report still apply to offshore installations, the subsections below
provide additional insight.
The issues raised below for offshore installations are not hard barriers to offshore wind farms.
Offshore wind farms are used in Europe. Also, the oil and gas industry has decades of
experience with the erection, operations and maintenance of offshore energy systems.
Appendix E, Selected References, has several entries dealing specifically with offshore wind
farm installations.
D.2 Environmental
Environmental concerns, investigations, and permitting can be expected for offshore
installations just as they are for on-shore installations. The inter tidal zones, between the low
and high elevations may be the most sensitive; these zones tend to be rich in marine life.
Supporting Wind Power Take-off in the SARI/Energy Region
107
D.3 Technology
Turbines and Accessories
The materials used in the wind turbine construction needs to withstand the corrosive effects of
the water, particularly salty water since many offshore installations are in the sea as opposed to
fresh water lakes. The requirements here may not be that stricter than for on-shore
installations near the sea. The tender documents need to be clear on the location of the wind
farm, the expected environmental conditions, and the requirements on the supplier.
The stations may be assembled and tested on shore and then moved to the site
offshore.
Weight is a concern since the station most likely will be installed atop a tower. Heavier
the station, larger the foundation and larger the tower.
Since weight is a concern, the station may be compact to start with. Expansion or
changes later may be very difficult or expensive.
Access of the incoming outgoing cables to the switching station or substation becomes a
concern. They may need to be accessed later for repair or replacement.
If there is a liquid filled step-up transformer then the type of liquid is a concern. Since
the station atop the tower will be compact, there is a concern for the safety of
personnel working on the site with regards explosions and fires. If the liquid leaks there
is an environmental concern.
Circulating ground currents are harmful on land and utilities work hard to control the
ground currents and their associated electrochemical (Galvanic) reactions, At sea, in the
presence of salt water, the corrosive effect of such stray currents on metal parts will be
even more pronounced.
Electronics
Electronic equipment at the station needs to be designed and installed in such a way as to resist
humidity and corrosion. This concern applies to electrical connections (high voltage, and high
Supporting Wind Power Take-off in the SARI/Energy Region
108
D.4 Erection
Offshore installations offer both challenges and opportunities.
Access to the facilities, both for construction, operations, and maintenance will be not be
hampered by roads and bridges, their widths, turning radii, and weight limits. Barges and work
boats can come directly to the site.
Working at sea presents additional challenges, such as additional safety equipment, and
limitations on times when the site can be visited. Low tide or storms my preclude access at
times.
Installations near shore, the inter-tidal area, may be problematic. It will be hard to get a
construction barge to the site. Inter-tidal areas are often rich in marine life, and so there may
be environmental concerns.
Installations further out will have deeper water, and thus permit easier access for constructin
barges and maintenance boats.
109
Since the robustness of the medium and high voltage offshore networks can have a profound
impact on the revenue of the facility, the developer may wish to design and maintain the MV
and HV networks up to a point of connection to the existing utility transmission network on
land. That is, the developer may not want to have the transmission utility maintain the
undersea cable network at the at sea station.
110
APPENDIX E
SELECTED REFERENCES
American Wind Energy Association. Wind Energy Fact Sheet: 10 Steps in Building a Wind
Farm.
American Wind Energy Association (AWEA) website, www.awea.org.
Bazargan, M., Offshore Substation, IET Power Engineering, Volume 21, Issue 3, pages 26 and
27, June 2007.
Boehme, T., et. al, Offshore Transformer Platform Design, 8th International Workshop on
Large Scale Integration of Wind Power on Transmission Networks for Offshore Wind Farms,
October 2009.
Brish, Arie. Optimizing Wind Farms Maintenance Cost, Distributed Energy: The Journal of
Energy Efficiency & Reliability. May/June 2010 Issue.
Capacity Development for the Clean Development Mechanism. CDM Pipeline overview
http://cd4cdm.org/index.htm
Central Electricity Regulatory Commission. Indian Electricity Grid Code.
CIGRE Technical Report B3.26, The Challenges Facing AC Offshore Substations for Wind
Farms, Electra, Number 253, December 2010.
Det Norske Veritas, Offshore Substations for Wind Farms, Offshore Standard DNV-OS-J201,
Octrober 2009.
Global Wind Energy Council website, www.gwec.net.
Hoepfner, S.; Gierer, U.; Cooke, R.; Innovative Platform Solutions with Integrated Design for
Offshore AC Substations from 60 MW to 800 MW Experience form Realized Projects and
111
Future Challenges, 8th International Workshop on Large Scale Integration of Wind Power on
Transmission Networks for Offshore Wind Farms, October 2009.
Indian Central Electricity Regulatory Commission, for tariff guidelines.
Indian Ministry of New and Renewable Energy, New Delhi website www.mnre.gov.in
Indian Ministry of Power, Indian Electricity Act 2003, and National Electricity and Tariff Policy.
Indian Wind Energy Association. InWIND Chronicle, 2008-2010.
Integration of Large Scale Wind Generation Using HVDC and Power Electronics, CIGRE
Technical Bulletin 370.
J. Finn, et. al, Designing Substations for Offshore connections, CIGRE Paris Session B3-201,
August 2008.
Maharashtra State Transmission Utility. Connection Application Procedure for Intra-State
Transmission System.
National Grid Electricity Transmission plc, UK. The Grid Code.
PJM Generation and Transmission Interconnection Studies, Main Manual.
Power Grid Corporation of India Ltd. Model Bulk Power Transmission Agreement for Long Term
Open Access.
Pramod, Jain. Wind Energy Engineering, McGraw-Hill Professional, 2010.
REN21 website, www.ren21.net.
Ris National Laboratory, Denmark. Wind power and the CDM,
http://cd4cdm.org/Publications/WindCDM.pdf, June 2005.
Smith, J. Charles, et al. Best Practices in Grid Integration of Variable Wind Power: Summary of
Recent US Case Study Results and Mitigation Measures, paper presented at EWEC 07, Milan,
Italy. May 2007.
Strack, M. and W. Winkler. Analysis of Uncertainties in Energy yield Calculation of Wind Farm
Project.
US Department of Energy Wind and Hydropower Interconnection Standards.
US Federal Regulatory Commission. Order No. 661A-Interconnection for Wind Energy.
Supporting Wind Power Take-off in the SARI/Energy Region
112
113
114
APPENDIX F
VENDOR CONTACT
INFORMATION
115
Model
Rotor Diameter / Hub Height (in
meters)
V-82 1.65 MW
RD : 82 m
HH : 70 / 78 / 80 m
Tower Type : Tubular steel
1600-48
RD : 48 m
HH : 50/55/60 m
Tower type : Tubular
116
Capacity
1650 kW
Available
(06.02.2013)
600 kW
S.
No.
3
Model
Rotor Diameter / Hub Height (in
meters)
E-48 RD : 48 m
HH : 50/56/57/65/75/76 m
Tower type : for HH
50/56/57/765/76 m Tubular steel
& 75 m pre cast concrete
________________
E-53 m HH : 73/75 m
Tower type : For HH
73 m steel & 75 m concrete
tower
GE 1.5sle
RD : 77 m
HH : 80 m
Tower type : Tubular Steel
Pioneer P250/29
RD : 29.6 m
HH : 50 m
Tower type : Latice
117
Capacity
800 kW
________________
800 kW
1500 kW
250 kW
S.
No.
6
J.Jawahar
DGM-Marketing
Email: energy@shriramepc.com
Mr.Sarvesh Kumar
DY.Managing Director
E-mail:
pawanshakthi@rrbenergy.com
Model
Rotor Diameter / Hub Height (in
meters)
Suzlon S82V3-1500 kW
RD : 82 m
HH : 78 m
Tower type : Tubular steel
Suzlon S88 V3A-2100 kW
RD : 88 m
HH : 80 m
Tower type : Tubular steel
SEPC 250 T
RD : 28.5 m
HH : 41.2 m
Tower type : Lattice
Pawan Shakthi-600 kW
RD : 47 m
HH : 50 m
Tower type : Latice
118
Capacity
150 kW
2100 kW
250 kW
500 kW
600 kW
S.
No.
9
10
11
12
Model
Rotor Diameter / Hub Height (in
meters)
GWL 225
RD : 29.8 m
HH : 45 m
Tower type : Tubular
Mr Madhusudan Khemka
President & CEO
VENSYS 77
RD : 76.84 m
HH : 75 m/85 m
Tower Type : Tubular steel
K82
RD : 82 m
HH : 80m
Tower type : Tubular
Capacity
225 kW
Bhushan.joshi@kenersys.com
119
1500 kW
2000 kW
S.
No.
13
14
15
16
17
Model
Rotor Diameter / Hub Height (in
meters)
WinWinD 1 MW
Capacity
1000 kW
Dinesh.agarwal@winwind.in
Phone : 04259-224438
Fax : 04259-224437
Phone : 022-66601557
Fax : 022-23544787
Phone : 044-30989898
Fax : Nil
Phone : 022-39918500
Fax : 022-39918521
RD : 60 m
HH : 70 m
Tower type : Tubular steel
CWEL 30/250kW
RD : 29.8 m
HH : Tower type : Lattice50 m
REpower MD77
RD : 76.5 m
HH : 85 m
Tower type Tubular Steel
G57-850 kW
RD : 58 m
HH : 444/55/65 m
Tower type : Tubular Steel
NOR WIL 750 kW
RD : 47 m
HH : 65 m
Tower type : Tubular Steel
120
250 kW
1500 kW
1500 kW
750 kW
S.
No.
18
19
Phone : 044-27926000
Fax : 044-27924944
Phone : 04294-220017
Fax : 04294-220137
Model
Rotor Diameter / Hub Height (in
meters)
Leitner LTW77-1.35 MW
RD : 76.6 m
HH : 65 m
Tower type : Tubular steel
Leitwind LTW77-1.5 MW
RD : 75.6 m
HH : 65 m
Tower type : Tubular steel
SIVA 250/50
RD : 30 m
HH : 50 m
Tower type : Lattice
121
Capacity
1350 kW
1500 kW
250 kW
Tetra Tech
DLF Cyber City, Building No. 9B, 11th Floor
Gurgaon 122 002
Tel: +91 (0)124 473 7400
Fax: +91 (0)124 473 7444
www.tetratech.com
04072011 v01