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The market deployment strategy developed by the European wind energy sector under the framework of TPWind, is outlined in Priority R&D areas in Wind Energy.
Thematic priorities on these aspects are:
- Removing electricity market barriers by implementing market rules that promote demand-side management and flexibility, and that provide much shorter gate closure times to reduce balancing costs. Improved forecasting tools, such as tools for developing assumptions on future market fluctuations in order to secure investments. In these integrated markets – at both local and international levels – wind power should be considered as an adapted market commodity that is tradable, exchangeable and transparent like other forms of energy. The market impacts of a large penetration of wind energy on the current electricity markets should be evaluated.
- Securing revenues by developing a stable market with clear wind power objectives and a stable and incentive scheme. Markets should make use of all possible power system flexibility to keep imbalance costs low. This includes markets for ancillary services, such as bringing virtual power plants to the market, and effective balancing markets.
- Creating a level playing field by integrating wind power’s positive externalities, such as contribution to energy independence and climate change mitigation. This would lead to recognition that wind energy deserves to be categorised as a public interest investment that is largely independent of fuel prices and has very low external costs.
- Adapting the grid infrastructure to make wind as manageable and as cost-efficient as possible for network operators. One approach is for wind power plants to be operated, as far as possible, like conventional power plants, to develop the electricity grid infrastructure needed, to implement common market policies and align existing markets, to develop large-scale energy storage solutions, demand-side management, and to adapt grid codes.
- Removing policy and administrative barriers to grid development through strategic planning, strong political leadership and adapted consenting processes.
In the past few years, energy demand has gone up significantly and the price of fossil fuel has increased. In the case of wind energy, after a period in which costs decreased in line with experience, there has recently been an increase in wind energy costs due to very high global demand and rising commodity prices.
Other reasons for the rising costs include the increase in the overall price of materials and supply chain bottlenecks. The wind energy sector and policymakers should focus on reducing the cost of investment, which would lead to reductions in the lifetime cost of energy, making wind more competitive. These priorities are:
- Investment costs. These are influenced by bottlenecks in the supply chain, which limit the effects of economies of scale on costs. Moreover, due to high demand, logistics and service suppliers will also suffer from supply bottlenecks, leading to higher investment costs. Uncertainties remain regarding the future cost of raw materials and the subsequent impact on the cost of wind energy. Finally, as installed capacity increases, wind power will move to more challenging environments, needing technological improvements to reduce costs.
- Operating costs. These account for a significant proportion of the overall lifetime costs. This can be reduced substantially by improving reliability, optimising operational services and component supply and developing specific offshore systems.
- The cost of capital. This is closely linked to the financial sector’s confidence in the technology, future revenue and market sustainability. Reducing exposure to risk in different categories will in turn reduce the cost of capital.
In order for wind energy markets to develop further, ambitious wind energy targets need to be set and appropriate measures taken in the EU Member States. Policy has to be consistent, stable and long–term, to allow for the most efficient investment and cheapest electricity for the consumer.
Long-term legally binding wind and renewables targets should be implemented at national level, and a break-down for the power, heat and transport sector is recommended. Penalities should be imposed on Member States that do not comply with the national targets or action plans. Stable and long-term support schemes are essential, too.
Key issues exist with the current administration of applications for wind farms and auxiliary infrastructures in many parts of Europe. These include inconsistencies and uncertainties in the requirements and judgments of administrative authorities, and delays in the consenting process.
Despite policies supporting wind energy at European and national level, it is also difficult to obtain planning permits in many Member States.
In some Member States, there is a lack of clarity on the administration requirements and processes for wind farm applications, particularly in relation to applications for repowering existing wind farms. Repowering projects create new challenges over and above those of developing new wind farms on a site.
In extreme cases, wind farm projects are rejected by consenting authorities because of minor adverse local effects, as their positive impact on the global environment is not considered.
At present, Environmental Impact Assessments (EIAs) are inefficient and the results of EIAs are not widely disseminated. A consensus has yet to be reached on whether EIAs could use studies that have already been carried out, rather than doing full and separate studies for each time an EIA is performed.
The results of existing environmental monitoring across Europe need to be centrally gathered and reviewed in order to identify existing gaps in knowledge for future research.
Post-operational monitoring is currently not comprehensively evaluated against the areas of the EIA. The results are rarely shared widely or referenced in future assessments. As a consequence, much of the value of post-operational monitoring is not realised. Priority development zones should be identified for the strategic planning of wind farms, as a policy priority.
Compared to conventional sources of energy generation, wind energy is popular with the general public. The industry can help to sustain this by further implementing best practices based on public consultation; by remaining willing to address public acceptance issues; and by demonstrating improvements that reduce or mitigate impacts of public concern.
Whilst there is large-scale support for wind energy, wind farm applications can be delayed or blocked by apparent, or perceived, resistance from communities at a local level.
It is essential to involve local communities in the process of wind farm developments in their area, and to ensure that they also reap some benefits. Decision-makers need to be kept well informed of the real level and nature of public support, not just the perceived level.
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