Mathematical Problems in Engineering

Volume 2015, Article ID 614514, 9 pages

http://dx.doi.org/10.1155/2015/614514

## Economic Analysis of Wind Turbine Installation in Taiwan

Department of Electrical Engineering, Southern Taiwan University of Science and Technology, Tainan 710, Taiwan

Received 30 September 2014; Accepted 2 December 2014

Academic Editor: Mo Li

Copyright © 2015 Jeeng-Min Ling and Kunkerati Lublertlop. This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

#### Abstract

The wind speed characteristics are analyzed statistically based on a long-term hourly data record to evaluate the proper wind energy potential. The annual average wind speed and wind power density are investigated and compared by some significant indices, wind energy output and capacity factor, to show the variations of proper wind turbine specifications of installation in different locations of Taiwan. The minimum cost of wind energy is used to assess the economical feasibility for turbine installation in Taiwan. Great variations occur in the simulation results in both of the cost of energy and capacity factor. The detailed statistical analysis should be conducted to ensure the successful operation after wind turbine installations.

#### 1. Introduction

The demand for energy and particularly for electricity is growing rapidly in the country of rapid economic growth. Taiwan has no nature reserves, but electricity mainly relied on conventional fossil fuel. The development of electricity capacity from renewable energy in Taiwan is vital. In this aspect, wind power plays a major role in the enhancement of renewable energy before a sharp increasing in the photovoltaic energy after year 2020 [1]. With abundant wind resources along the west coast of Taiwan and some offshore islands, the Asian monsoon, tropical cyclones during the summer season and the northeast trade winds during the winter season, induces high winds speed in many regions. Taiwan has superior advantages to develop wind energy geographically.

Many studies related to the study of wind characteristics and wind power potentials have been conducted worldwide recently [2–6]. Belu and Koracin studied the wind characteristic in western Nevada, USA, in which the wind speed at different tower heights is estimated using the standard power extrapolation equation and consequently the power law exponent values are analyzed for different time periods and locations [7]. The empirical and graphical methods were used to analyze the wind power density at the heights of 10, 30, and 60 m, respectively [8]. Two statistical methods, meteorological and Weibull, were presented to evaluate the wind speed characteristic and the wind power potential at an open area of 17 synoptic sites distributed throughout the territory of Tunisia [9].

Many researchers have proposed different economic methods to assess installation of wind turbine. Fingersh et al. presented a simple payback period method [10]. The simple payback period is the number of years which will be taken to recover the initial capital cost for installation of a new wind turbine generator (WTG). An important issue of this model is assumed by the fact that WTG will produce the same amount of electricity each year and attain constant revenue stream. However, the discount rate and the lifetime of the project are not considered. The cost model of wind energy is defined as the unit cost to produce energy from the WTG system. The numbers of lifetime of project and discount rate are included when annual cost is evaluated. Schmidt constructed expressions for computing component costs of wind turbine [11].

This paper proposes a procedure based on the detailed economical model including wind turbine components cost, the annual operation, and maintenance cost of wind turbine to get the minimum cost of wind energy. The minimum cost of wind energy was used to assess the feasibility of installed wind turbine at 24 locations in Taiwan. The wind energy output and capacity factor of twenty commercial wind turbines in terms of different designed hub height were also investigated.

#### 2. The Mathematical Models for Wind Energy

Using estimation of regional wind resources, one can estimate the electrical producing potential of wind energy. This wind energy resource atlas identifies the wind characteristics and distribution of the wind resource. An important parameter in the characterization of the wind resource is the variation of horizontal wind speed which is expected to be zero at the earth’s surface and to increase with height in the atmospheric boundary layer. Wind speed is the most important aspect of the wind resource; in fact the year variation of long-term mean wind speed provides an understanding of the long-tern pattern of wind speed and also gives confidence to an investor in the availability of wind power in coming years [12].

The wind speed measured at weather station differs from the height of WTG hub. If these heights do not match the hub height of a WTG, it is necessary to extrapolate the wind speeds to the hub height of the WTG. This variation of wind speed with elevation is called the vertical profile of the wind speed or vertical wind shear, and it can be implemented by the following [13]:where is wind speed at the hub height of WTG; is wind speed at the weather station; is hub height of WTG; is sea level height of the weather station; is wind speed power law coefficient.

The actual wind power output of WTG is determined by the turbine performance curve, which is well described by (2). The coefficients of the power curve can be described by the specification of wind turbine manufacturer. The power curve with third-order equation is easily digitized into any discrete points dependent on the simulation accuracy. Considerwhere , , , and are coefficients of the power curve of WTG; is cut-in speed of WTG; is rate speed of WTG; is cut-off speed of WTG; is rated power of WTG (kW); is the electrical power output of WTG (kW).

After comparing the actual WTG energy output and the energy output with rated capacity, the capacity factor (CF) can be conducted. Consider

The wind energy output from a wind turbine evaluated by the Weibull, Rayleigh, Lognormal, and Gamma probability models are denoted by the following:where is the actual wind energy output of the WTG for the period (kW/h), is the wind energy output operated with the full capacity for the period (kW/h), is the probability density function (Weibull, Rayleigh, Lognormal, and Gamma), and is the mean winds speed (m/s).

#### 3. Economic Analysis Methods

The unit cost of wind electricity power can be determined by knowing capital investment and operating costs. It is important for estimating the investment cost of each WTG type in each location before installation. However, the value of the wind electricity power is somewhat difficult to determine, but it must be evaluated before making investment decision. The significant cost of wind energy will be included and discussed in this study.

The cost of energy (COE, $/kWh) can be defined by (5), where is the total annual cost ($) and is the annual electrical energy output of WTG (kWh). Consider

The total annual cost of a WTG is the sum of its operation, maintenance expenses, and annual repayments on its capital. It can be determined by the following:where is the discount factor; is the discount rate (%) and often takes about 10%; is the lifetime of project, often taken to be 20 years; is the initial capital cost of building WTG ($).

The operation and maintenance cost yearly may be expressed as a proportion of the initial capital cost about 2.5% [14]. In this study, the initial capital cost of WTG is set based on references [10]. Using the model, the total annual cost () of the project can be estimated. The annual COE is a popular index to estimate the different amount of electricity for each WTG at each year. The component cost models needed to calculate the initial capital cost of wind turbine can be summarized in the following list of the components cost and in Figure 1 [11].