Disruptive data technologies are set to raise the competitiveness of U.S. wind power in the coming years and new growth areas will include repowering, offshore wind and energy storage, leading global turbine suppliers said at the Wind O&M Dallas conference on April 11.

The cost of wind power has fallen dramatically in recent years on improved technology and increased competition in the operation and maintenance (O&M) market.

In many states wind power generation is now highly competitive against other generation types. Utilities are increasingly looking to wind power to expand their rate bases or replace aging, inefficient coal-fired power plants, Moody's Investors Service noted in a new report published March 15.

The federal Production Tax Credit (PTC) will continue to support wind power construction until 2020 and digital innovations along with higher-performance turbines will drive down costs, Andy Holt, General Manager North America Wind, GE Renewable Energy, told the conference in Dallas.

"We are going to have big years. For all the OEMs [Original Equipment Manufacturers]...our job is to develop a turbine for the 2020/2021 timeframe that moves into three cents [per kWh] wind, that moves into unsubsidized spaces," he said.

                       Wind power share of total generation by US state

Source: American Wind Energy Association (AWEA), February 2017.

Data power

Increasing investments in data analytics are helping the wind industry move from reactive maintenance to predictive maintenance, reducing energy losses and labor costs.

"The last two or three years have been the most disruptive of the last 50 years in power generation when it comes to services and new equipment," Mark Albenze, Head of Wind Services at Siemens-Gamesa, told attendees.

Big data is disrupting every traditional business model and the vertical power market model of producer to consumer will transform into a "multidirectional market" where energy platforms serve centralized and decentralized generators, consumers, transportation and storage, Albenze said.

"The transformed power market will require our industry to deliver more than LCOE [Levelized Cost of Energy], we must deliver market value proposition of affordable capacity and energy but be flexible to match market conditions," he said.

Proactive maintenance aligns downtimes with market and site conditions and data-led learnings are making turbines more "intelligent" and self automating, reducing unnecessary callout costs.

Siemens has been collecting wind turbine data for over 20 years-- representing 60,000 turbine years of insight-- and analyses 21 trillion values stored weekly.

These large and growing datasets place the wind industry in an ideal position to offer predictive assessments and optimize assets, Albenze said.

"We can offer higher availability, condition-based maintenance, proactively executing work to align with market conditions, offer module surfaces, and shift to intelligent services that automatically respond to conditions, optimize production and manage wear and tear," he said.

Repowering boom

Repowering is an excellent growth opportunity for the wind industry, the speakers told the conference.

Compared with Europe, the U.S. has a limited history in repowering projects due to the relatively young age of the market. In 2015, only 600 MW of U.S. wind capacity had been installed for longer than 20 years, the typical turbine lifespan, according to data from the National Renewable Energy Laboratory (NREL).

The U.S. federal government’s extension of the 10-year Production Tax Credit (PTC) scheme has boosted interest in repowering projects. Almost 10 GW of U.S. wind capacity is between 10 and 20 years old, according to figures from Bloomberg New Energy Finance (BNEF).

Repowering will allow operators to replace less reliable units with supported new models that raize efficiency and lower the cost of energy, Matthew Coleman, Senior Director, West Region Operations at Vestas, said.

"It's a new variable that maybe two years ago nobody was thinking about...it opens up those 60% capacity factor areas to take on new technologies and new innovations," he said.

Repowering also offers an opportunity to update plants with the latest data analytics and condition monitoring systems, Philippe Delleville, Vice President, Services at Gamesa, North America, said.

"You give yourself the chance....to build in the capabilities that newer machines have," he said.

Energy storage

Leading technology firms are also investing significantly in energy storage projects to raise the value proposition of wind farms within wholesale markets.

A key challenge is storing the high power levels generated by the latest wind turbine technology and GE Renewable Energy's current energy storage projects include joint wind and solar storage projects and studies into new battery designs, Holt said.

"Right now, it feels like it is a couple of years out before that's viable, commercially," he said.

Siemens-Gamesa is also active in a number of energy storage research and development (R&D) projects, Albenze said.

"Five or 10 years from now I think you will see a dramatic change in the landscape of storage and wind...and PV and storage," he said.

Wider deployment of energy storage will require adjustments to market rules in addition to technology improvements and cost reductions, Jeff Wehner, Vice President of Operations, Duke Energy, said.

Ancillary markets differ between regions and Duke Energy has found it challenging to receive payment for a 34 MW energy storage facility in West Texas which fairly reflects the value of the project, Wehner said.

"It's something we need to look at nationally...Where's the value for the owner in all this-- that's a real question," he said.

Offshore growth

The speakers also predicted steady growth in the emerging U.S. offshore wind market in the coming years.

European offshore wind costs have plummeted in recent years and this has prompted rising interest from Oil and Gas majors. Norway's Statoil and Royal Dutch Shell are increasing investments in offshore wind projects and these firms bring decades of operational efficiencies in offshore installation and maintenance practices.

U.S. offshore installation efficiencies will be boosted by an influx of local manufacturing capacity and services, in addition to learnings from the more mature European offshore industry, Albenze said.

"The price of offshore is nowhere near what we predicted it to be just five years ago, it’s a lot less," he said.

GE Renewable Energy boosted its offshore wind expertise through its acquisition of French technology firm Alstom and the company supplied turbines to the 30 MW Block Island windfarm, the U.S.' first offshore wind project.

The U.S. offshore wind market will see steady growth, providing an additional revenue stream for suppliers, Holt said.

"It's going to be a steady portion for all of the OEMs to fight for," he said.

Wind Energy Update