WIND ENERGY SYSTEMS - Cd3wd

Chapter 8—Economics 8–5
results with similar results for small machines, to see if there are any effects of size. Results of
a study on small machines[6, 2] are given in Table 8.2. Column one gives the cost percentages
for machines currently available in 1980 and column two gives the cost percentages predicted
for second and third generation machines in 1990.
TABLE 8.2 Construction Costs for Small Wind Turbines(%)
1980 1990
Rotor and hub 12.0 20.5
Controls 6.0 6.6
Transmission 11.0 14.5
Generator/power conversion 7.0 11.6
Frame 8.0 2.4
Tower 18.0 7.5
Installation 20.0 25.6
Distribution 16.0 9.5
Shipping 2.0 1.8
100.0 100.0
We see in this table that the frame and tower are two components which have a good potential
for cost reduction, from 26 percent to 10 percent of total cost. The cost of distribution
(dealerships, service groups, etc.) would appear to have some potential for cost reduction.
As the percentage of these cost components is reduced, then other components become relatively
more expensive. We see installation increasing from 20 to 25 percent of the total cost,
indicating a need for considerable innovation in this area.
There are no major differences between projected percentage costs for the large and small
turbines. Major cost components are blades, transmission, tower, and installation for all
turbines, indicating that these components need to be carefully studied for possible cost
reductions.
One of the challenges of economic studies is to estimate the cost of the installed wind
turbine when it is being produced in large quantities. The cost of the initial few machines is
quite high because of many specially made parts and substantial amounts of hand labor while
later machines are able to take advantage of higher volume production. A decrease in cost per
unit of product with increase in volume has been found to occur in a wide variety of areas,
including Model-T Fords, aircraft, steel production, petroleum refining, and electric power
generation. The classic example in recent times has been the hand-held calculator, along with
other integrated circuit components.
This decrease in cost has been formalized by learning curves. These are widely used in
many different industries. They are developed from the following mathematical model. If y
represents the cost of an object while x represents the cumulative volume, then the normalized
incremental cost dy/y is assumed to be related to the normalized incremental volume dx/x
Wind Energy Systems by Dr. Gary L. Johnson November 21, 2001