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The Future Cost of Wind Power


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Executive summary
Chapter 1 The economics of wind power
Wind power is capital intensive with most of the investment required upfront. The largest capital cost component is the turbine itself which can account for between 40% and 80% of the total capital cost of an onshore wind installation. Costs offshore are higher because of the more expensive operating environment and the greater difficulty establishing a foundation so the proportion of capital cost taken by the turbine is generally lower than onshore. Turbine cost fell from 1980 until 2002 when prices started to rise again, peaking in 2009 before falling further. Technological advances and greater overall efficiency are continuing to bring costs down. This is feeding into capital cost trends which are following turbine prices by falling. There are regional variations in capital costs, with costs lower in India and China than in Europe or the USA but regional differences are narrowing as the market becomes more global. With capital cost the dominant component of the cost of energy, the levelized cost of electricity from wind plants is falling too and onshore wind is beginning to compete with other technologies, particularly new coal. There is a growing consensus that onshore wind will reach parity in many parts of the world by the end of the decade, if not before. Offshore wind will take longer but could be competing with the main conventional sources of power by the middle or end of the third decade of the century.
Chapter 2 Future market and economic prospects for wind power generation
The cost of wind power has continued to fall compared to many other technologies over the past five years and is now approaching the level at which it can compete with conventional technologies. Power from natural gas and coal remains cheaper (without carbon capture and storage) but the steady growth in renewable penetration from both wind and wind power is leading to coal and gas-fired plants operating for less of the time, a factor which adversely affects their economics. On the other hand the low cost of wind power is leading governments to reduce subsidies to wind. By the end of the decade wind power could be the second cheapest source of electricity after natural gas in many markets. Growth of wind power is expected to continue strongly in the major markets of Europe, Asia and North America. Markets in Latin America are advancing more slowly and wind power in Africa remains a rarity.
Key features of this report
Analysis of wind power generation technology costs, concepts, drivers and components.
Assessment of electricity costs for different technologies in terms of the two fundamental yardsticks used for cost comparison, capital cost and the levelized cost of electricity.
Examination of the key wind power generation technologies costs.
Key benefits from reading this report
Realize up to date competitive intelligence through a comprehensive power cost analysis in wind power generation markets.
Assess wind power generation costs and analysis – including capital costs and levelized costs.
Quantify capital and levelized cost trends and how these vary regionally.
Key findings of this report
1.India ($1,080/kW - $1,250/kW) and China ($1,360/kW – 1,370/kW) show the lowest capital costs and the USA ($1,830/kW) and Brazil ($1,670/kW) the highest..
2.By 2014 the LCOE for a plan entering service in 2019 had fallen to $204/MWh.
3.The lowest costs recorded in the table are in India, where the LCOE ranges from $47/MWh - $113/MWh, and China where the cost is estimated to be $49/MWh - $93/MWh.
4.The range of levelized costs found for onshore wind was $75/MWh to $150/MWh.
5.Offshore wind had a range of $130/MWh – 285/MWh and large solar PV $165/MWh to $400/MWh.
Key questions answered by this report
1.What is wind power generation going to cost?
2.Which wind power generation technology types will be the winners and which the losers in terms of power generated, cost and viability?
3.Which wind power generation types are likely to find favour with manufacturers moving forward?
Who this report is for
Power utility strategists, energy analysts, research managers, power sector manufacturers, wind power developers, investors in renewables systems and infrastructure, renewable energy developers, energy/power planning managers, energy/power development managers, governmental organisations, system operators, companies investing in renewable power infrastructure and generation, investment banks, infrastructure developers and investors, intergovernmental lenders, energy security analysts.
Why buy it
To utilise in-depth assessment and analysis of the current and future technological and market state of wind power, carried out by an industry expert with 30 years in the power generation industry.
Use cutting edge information and data.
Use the highest level of research carried out.
Utilize expert analysis to say what is happening in the market and what will happen next.
Save time and money by having top quality research done for you at a low cost.
Report Details
Report Title
The Future Cost of Wind Power
Report Subtitle
Capital costs, the levelized cost of electricity (LCOE), economics, costs and future outlook for wind power generation
Report Code
Publication Date
January 2015
Report Type
Report Size



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