The cost of electricity generated from onshore wind turbines will drop by 12% in the next five years, meaning the average turbine will be competitive by 2016. These were the words of analysts at Bloomberg New Energy Finance who say the best wind farms in the world already produce power as economically as coal, gas and nuclear generators.
Justin Wu, lead wind analyst at Bloomberg New Energy Finance, said: “The public perception of wind power tends to be that it is environmentally-friendly, but expensive and intermittent. That is out-of-date, in the best locations, where generation is already cost-competitive with fossil fuel electricity and that will be the case for the majority of new onshore turbines installed worldwide by 2016.
The analysts estimate the manufacturers of onshore wind turbines are experiencing a 7% drop in cost for every doubling of installed capacity. These economies of scale and supply chain efficiencies are one factor in reducing costs. Another factor driving down price is the increased power generated from bigger turbine blades. Bloomberg say these improvements have increased capacity factors by 13 percentage points to 34% over the past 27 years.
Global average turbine prices have fallen from €2m/MW in 1984 to below €0.88m/MW in 2011. In 1984, there was only 0.3GW of installed wind capacity in the world, but by the end of 2011 there will be over 240GW.