Wind Energy Costs to Drop Significantly in the Future

The costs of wind energy are going to drop considerably in future due to technology & commercial advancement , according to a survey led by Lawrence Berkeley National Laboratory (Berkeley Lab) of the world’s foremost wind power experts. Experts anticipate cost reductions of 17%-35% by 2035 and 37%-49% by 2050, driven by bigger and more efficient turbines, lower capital and operating costs, and other advancements.

The study summarizes a global survey of 140 wind experts on three wind applications – onshore (land-based) wind, fixed-bottom offshore wind, and floating offshore wind. “Wind has experienced accelerated cost reductions in recent years, both onshore and offshore, making previous cost forecasts obsolete. The energy sector needs a current assessment,” said Ryan Wiser, senior scientist at Berkeley Lab.

Under a “best guess” scenario, experts anticipate 17%-35% reductions in the levelized cost of energy by 2035 and 37%-49% reductions by 2050.  Levelized costs reflect the average cost of energy per unit of electricity output over the lifetime of an electricity plant and are useful for evaluating technology progress.

There are five key factors that impact the levelized cost of energy: upfront capital cost, on-going operating costs, capacity factor, project design life, and cost of financing. Experts anticipate continued improvements across all dimensions, with the relative contribution varying by wind application. “Forecasts that consider only improvements in capital cost will, at best, capture about 45% of the cost reduction opportunity,” noted study co-author Joe Rand, also of Berkeley Lab.

A key driver in these improvements is turbine size, according to experts. The new study finds that cost reductions have accelerated in recent years: faster than previously predicted by most forecasters, and faster than historical rates of decline. The experts surveyed anticipate future reductions and growing use of value-enhancement measures, both for onshore wind and offshore wind.

“All else being equal, these trends will enable wind to play a larger role in global energy supply than previously thought while facilitating energy-sector decarbonization,” said co-author Joachim Seel, also with Berkeley Lab.

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