Repowering is not a new idea, with first efforts in the U.S. occurring in the late 1990s with the San Gorgonio Westwinds repower in California.
Since then, several projects located in California have undergone similar repowering efforts. More recently, projects outside California are getting more attention and include the potential repowering of the Mendota project, owned by Leeward Energy, or the repowering efforts being undertaken by NextEra.
With more than 84,000 MW of wind power in the U.S., representing nearly 6% of total U.S. electrical generation in 2016, repowering wind projects will continue to be an important topic in future years.
The decision between repowering a project versus continuing to operate is dictated by the type and age of the project under consideration. There are two main reasons for repowering projects: end of the turbine’s life or, typically, end of tax credits.
End of life – These projects are nearing end of design life, using outdated or sub-megawatt technology, not receiving support from original equipment manufacturers (OEMs), or having difficulty obtaining spare parts. They are typically greater than 20 years old, but this can also apply to cases prior to 20 years when the turbine technology no longer had the support of the OEM.
End of production tax credit (PTC) – These projects are still operating without significant issues but no longer receive PTC benefits. By nature of the credit, these projects are near to or have surpassed 10 years of operations. These projects could still continue to operate successfully without the PTC, but requalifying for PTC benefits is financially beneficial.
There are two main repowering approaches:
Full repower – This would constitute the construction of a new or almost new project in place of an older project operating in the same area.
Partial repower – This would include the replacement of certain main components (such as the rotor or gearbox) while keeping other components for reuse (such as the foundation or tower).
Typically, end-of-life repowering requires a full repower to take advantage of the new turbine technology. A 2 MW to 3 MW generator and an 80+-meter rotor are not compatible with older towers and foundations that operated in the sub-megawatt range.
A partial repower is a new phenomenon that has become economically attractive for end-of-PTC repowering in which the original project has only operated for about 10 years. The electrical collection system, foundations, towers, nacelles, bed plates and yaw gear may still be in good condition, of suitable design and able to be reused during the repowering process.
Both partial and full repowering will play an important part in the U.S. wind industry in the future. Both offer an opportunity to improve overall project performance through the use of more modern technology that has benefited from the many lessons learned in the past 10 years. According to the American Wind Energy Association, nearly 4,000 MW of wind power is more than 15 years old and could be suitable for full repowering. Projects between eight to 12 years of age (i.e., expiration of the PTC) account for around 26,000 MW and may be suitable for partial repowering for PTC requalification.
Repowering, whether full or partial, can require as much work and preparation as a regular greenfield project. Although certain aspects, such as land leases or permits, can be leveraged or reused from the original project, all items must undergo a thorough review to ensure they are still applicable for the repower. It is important to consider the specific details of a particular project before deciding whether to repower or continue operating the original equipment.
When determining whether to repower or repair, consider the following key items in your analysis:
Project contracts. Current project contracts may require updating for a repowering. These include off-take agreements, the interconnection agreement, permits, land leases and other project-specific agreements. Contracts that have specified costs or revenues based on the size of a project or generation quantity should be revisited to determine potential impacts or limitations. Contracts may not have been structured to deal with repowering or may have ambiguities in the language that need clarification.
For example, if an off-take agreement is for 50% of the project output but was based on a specific project turbine or a specific project size, further clarification should be obtained on how a new rotor diameter, larger generator or higher capacity factor would be accommodated. Historically, prices for power purchase agreements have decreased over time, so any renegotiation could include a different pricing structure for all or some of the output. Interconnection agreements are also crucial capacity-based contracts that will need to be reviewed. Interconnection capacity limits may restrict project output, and restudies may be necessary to update the agreement.
Permitting. If repowering is selected, it is crucial to understand the requirements and overall effort needed to complete the repower. Most repowering will require some updates to permits, as larger rotors will mean a taller turbine tip height and new Federal Aviation Administration permits. Required setbacks, permit terms for operations, and risk to sensitive areas or species must be considered, not only for project operations, but also for the construction phase. Owners should make sure they budget enough time to get through the permit process and be aware of any risk of having to revisit old issues that may require updating since the last investigation.
Economic benefit. The economic benefit of repowering should be compared with the option of maintaining the original project. A recent NREL report noted that full repowering is generally not financially beneficial until a project reaches 20+ years of operations. However, a partial repowering can be financially attractive as a project reaches the end of PTCs in year 10.
Other reasons for repowering may include limited or no support from the OEM (i.e., due to bankruptcy or discontinued turbines) and difficulty obtaining spare parts. BP is investigating partial repowering of its Clipper turbines, reusing the foundations and towers but installing new nacelles and rotors from another OEM.
Infrastructure. While a full repower tends to mean mostly new infrastructure, before embarking on a partial repower, the reused equipment needs to be studied for suitability for the new operating conditions. Foundations, towers, reused turbine components and the electrical system all need adequate reviews to ensure they can accommodate the new components, additional electrical output and higher loads. It is important to review as-built conditions and operating history, which can be input into these analyses for greater certainty. For example, the suitability of a reused foundation may be improved based on the known as-built strengths of the foundation instead of the foundation-design-specified strengths. Any reused components should be inspected to make sure the assumed state of the equipment represents actual operating conditions.
It is important to ensure that the completed turbine, whether fully or partially repowered, has been reviewed by a certification agency. For partial repowers, which include a combination of old and new components and a known period of operations, standard certifications seen for new-build turbines do not apply, and a new certificate is recommended. An OEM will also provide a turbine loads assessment for the repowered setup, which could require curtailments as part of the requirements for site suitability.
As part of the decision process, an owner must consider long-term requirements to successfully operate the project if repowering is not performed. This is particularly important for projects with older technologies, with technologies that have fewer globally deployed turbines, with turbines that are no longer supported by the OEM, or with turbines for which the OEM no longer exists. As an example, if a turbine is no longer supported by an OEM, the owner would need to secure the proper supply chain for repairs.
Operating costs. Although historical project operating expense (OPEX) costs would be well known, future costs may change based on the details of the repowered site. New equipment would be under warranty for several years, which should reduce OPEX expenditures during those years. Other benefits of repowering can include lower-than-typical development costs, improved operations due to new or retrofitted technology, higher energy output or smaller project footprint, and lower overall long-term operating costs.
However, the reused equipment in a partial repowering could require increased inspections or remediation measures over the remaining life of the project. The reused equipment may not be covered under any new warranties, so operators must be aware of any performance risk of reused equipment and take this into account when estimating future operating costs.
These considerations should be compared with cost expectations for running the original project. Continuing to operate a project can have several benefits: The owner is already familiar with the site operations and current issues and has a good idea of operating performance, overall generation amounts, and operations and maintenance expenses. Undertaking a repower requires readjusting overall project expectations, which leads to a period of operating uncertainty until a repowered plant matures.
Decommissioning costs. Replaced components must be resold, recycled or disposed of, and the site must be returned to a condition that complies with permitting requirements. Consider including disposal or deconstruction requirements as part of the contractual terms of any turbine supply agreement or engineering, procurement and construction contract in order to more easily quantify decommissioning costs.
Revenue. When deciding between repowering or repairing, increased energy production is another reason to consider repowering. Per-turbine output will typically be larger due to bigger rotors. Improved reliability can also be expected, which can increase project output, such as in the example of replacing a Clipper turbine with another manufacturer. Repowering may also allow for requalification of PTCs, which can boost overall project revenue.
Another analysis that should be completed when deciding between repowering or repairing is determining turbine useful life. By better understanding the expected life of the original project and when atypical or critical repairs may be needed, an owner can make a more informed decision as to the value of operating versus repowering. Although most turbines have a design life of 20 years, it is expected that with proper maintenance, most projects can operate for more than 20 years, continuing to provide project revenue for additional years beyond the design life, subject to site-specific conditions and the ability to operate safely.
Construction and start-up. An owner must also be aware of issues that can surface during a repowering. In a partial repowering, reused equipment will be part of the repowering. Proper checks on critical reused items must be performed prior to repowering to prevent delays during construction and to avoid costly rework.
As with any new project, it is expected that start-up issues will occur and that a new break-in period will be required. A project owner must take this into consideration or be caught off guard by lower initial performance and higher operating costs. Making sure that any construction or equipment contracts include proper testing and sign-off milestones, with adequate warranty terms, will help alleviate these issues.
Temporary reduction in turbine availability and energy output is expected during construction, and this must be taken into consideration, especially if an off-take agreement has availability or generation guarantees.
Although no single solution will be adequate for all projects, the option to repower allows for greater flexibility, which will benefit the industry in the long term.
Jeremy Tchou is director of North American due diligence services at AWS Truepower. He can be reached at email@example.com. Gill Howard Larsen is global director of due diligence services at AWS Truepower. She can be reached at firstname.lastname@example.org. Emil Moroz is senior turbine engineer at AWS Truepower. He can be reached at email@example.com