Wind farm connection rates have recovered to pre-2007 levels, with 207.7 MW connecting in 2008. In 2008, wind generation produced approximately 2.3 TWh of electricity, increasing its share of electricity consumption from 6.8% in 2007 to approximately 8.7% in 2008.
Ireland’s target is to supply 15% of electricity demand from renewable sources by 2010. As large-scale hydroelectric development in Ireland is not a viable option, wind has contributed, and will continue to contribute, the vast majority of the additional renewable generation required.
Added to other renewable generation stock, an estimated 1,350 MW of wind capacity is required to meet the target for 2010. At the end of 2006, 744 MW of wind capacity was connected. To meet the 2010 target from that point required the addition of 200 MW annually. In 2007, only 48.25 MW were added and this was a setback in efforts to meet the target. In 2008, wind farm connection rates were more in line with 2005 and 2006. However, it appears that meeting the target will hinge on the capacity additions in 2009 and the first half of 2010. The system operators have target connection dates within this time frame for more than 600 MW of contracts. These dates have been subject to slippage in the past, but if 60% to 70% of those contracted wind farms are connected within the period, the target may be achieved.
Contracted wind farms totaled 1,412.3 MW at the end of 2008. These successful applicants were taken from the applicant queue via a group processing approach, which is discussed later in this report. A key national objective for renewable energy was revised during 2008. As outlined in the 2007 Energy White Paper, Ireland had aimed to supply 33% of its electricity demand from renewable sources by 2020. This target has been increased to 40%, and the government has emphasized that the target is to be seen as a minimum rather than a ceiling. Using current emission factors for Ireland’s fuel mix, a 33% penetration of renewable generation in 2020 would deliver a CO2 saving alone of more than 7 million tonnes/yr. It can be seen from the figures for current connection applicants (11,000 MW), sites contracted for connection (1,412.3 MW), and wind farms already connected (1,002 MW) that the wind industry is capable of providing the generation required as long as conducive conditions persist and the system operators have capacity to connect.
Approximately 280 MW of new renewable capacity is required each year from 2009 to 2020 if the target is to be met. The peak connection rate to date was 231.85 MW in 2006, and the average connection rate over the past three years has been 162.6 MW. Ireland’s electricity regulator, the Commission for Energy Regulation, undertook a series of public consultations during 2008 that led to a direction to system operators as to how they should approach the connection of wind applicants in the next round of group processing. Those wishing to connect to the grid join an applicant queue once their application is “deemed complete.” The options considered for accepting applicants into Gate 3 included a date-order approach (as per Gate 1), a mixed date-order/optimization approach (as per Gate 2), or a new approach proposed by the system operators known as the Grid Development Strategy (GDS).
The GDS will result in the issuance of offers to an amount of applicants in the connection queue at gate closure. The aim of the GDS approach is to plan and develop the grid to meet its anticipated demand and generation needs up to 2025 in a cost-effective, optimal, and efficient way by assessing the system over a longer term than has been used in the past.
According to the Commission for Energy Regulation, “the GDS allows for the optimal connection of a very significant capacity of renewable generation in Ireland over the coming years, facilitating the achievement of the 40% Government renewable target through a long term and strategic programme of transmission development, to the benefit of renewable generators and end-customers.”
During the next phase of the process up to 2011, 3,890 MW of renewable generation, including 3,877.5 MW of wind capacity, chosen by “deemed-complete” date order, will be offered. It is intended that this amount added to the grid by 2025 will provide the capacity needed to meet the 2020 targets, and it also takes into account some attrition of sites already holding connection offers. Where the local capacity of a node on the grid is less than the firm capacity required by a group of generators, firm access to the network will be rationed on the basis of date order of applications received.
Sites within Gate 3 will have the option to increase their maximum export capacity (MEC) by 20% up to a cap of 4 MW to account for changes in technology over the time scales the connection process may take. The entire list of wind connection applicants, including those in Gate 3, amounts to over 11,000 MW at year’s end. To put this into context, Ireland’s peak demand was not expected to rise above 5,000 MW during the 2008/2009 winter season.
In 2008, just 200 MW of interconnection existed between the Republic of Ireland and Northern Ireland. As a result, the Irish Republic’s grid is relatively isolated. The East-West Interconnector project has progressed significantly in 2008 and is on course to be completed by 2012. The East-West Interconnector will have a capacity of 500 MW and will be the first connection between the Republic of Ireland and Britain’s transmission systems. It is hoped that the interconnector will assist in the deployment of high levels of wind generation and provide generators with access to a larger market. Marine surveys have been completed, the proposed route chosen, authorizations granted, and connection points determined. Final permissions are currently being sought at either end of the two high-voltage direct-current cables.
In January 2009, the European Commission announced a contribution of 100 million € toward the strategic infrastructure as part of its “Investing today for tomorrow’s energy” economic development plan. Another 350-MW high-voltage directcurrent interconnector between Ireland and Britain is planned by Imera Power, a private asset-investment company that will build and operate the interconnector on a merchant basis.
Benefits to National Economy
The design, development, construction, equipping and connection of wind farm facilities in Ireland is estimated at 300 million €/yr of economic activity over the past three years. Up to 80% of the outlay is spent on imported equipment, including the turbine and associated electrical equipment. Therefore, the value to the local and national economy could be estimated to be worth approximately 60 million €/yr.
The value of civil and construction costs to the local economies is approximately 30 million €/yr.
Development of wind farms in Ireland has been undertaken by a wide range of individuals and organizations—from farmers and indigenous development companies to subsidiaries of semi-state bodies, utilities, and multinational developers. A landowner has the option of leasing land suitable for wind farm development without having to get personally involved in the development of the site. Typical costs for leasing such land are in the range of 6,000 €/MW installed.
Because the equipment is imported, the associated operation and maintenance (O&M) costs are with international suppliers. Therefore a large portion of the O&M expenditure, which is estimated to be 1.5% to 3% of the capital costs of a project, goes to equipment suppliers and manufacturers abroad. Current total capital costs are in the range of 1.7 million €/MW installed for wind developments in the 10-MW range.
A major development in the wind sector came during 2008 when Scottish and Southern Energy plc completed the acquisition of Airtricity Holdings Ltd, valued at the time at 1,455 million €. Airtricity has wind farm projects in Ireland, China, Europe, and the United States. Scottish and Southern Energy plc is the second-largest generator and supplier in neighboring United Kingdom, with operations in a range of other utilities and services.
Although a burgeoning ocean energy industry is developing in Ireland, the country has no manufacturing industry of large scale wind turbines. There is, however, a developing micro-scale turbine manufacturing
industry, with a handful of companies developing their own units and masts. In addition, several companies are involved in manufacturing key mechanical and electrical components for both micro-scale and large-scale turbines and generators.
In 2007, the average size of a large-scale wind turbine grew to 1.9 MW; however, in 2008 the average size fell to 1.65 MW. During 2008, 128 turbines were installed in 12 wind farms, including extensions to two existing wind farms.
Turbine costs currently range between 1.1 million € and 1.4 million €/MW, depending on the size of the turbine and the project. The trend in costs continues to be upward. A typical cost for connection would be in the range of 150,000 € to 300,000 €/MW. With the global economy facing recession, the demand for materials and hence costs are expected to be reduced.
Current support mechanisms for renewable generation take the form of a Renewable Energy Feed-In Tariff (REFIT). REFIT is a public service obligation–backed power purchase agreement. Section 4.0 will provide details of the mechanism. The single electricity market (SEM) has been live for more than a year. Northern Ireland and the Republic of Ireland trade almost all of their electricity through a gross pool operated by the SEM operator; a portion of electricity is still traded bilaterally with licensed suppliers outside of the pool.
Generators with installed capacity of less than 10 MW can trade bilaterally if they choose, thus avoiding administrative burdens associated with market participation. All generators above the 10 MW minimum must trade in the mandatory pool, either directly or via an intermediary. The SEM Committee continues to consult on the treatment of wind and other intermittent generation in the SEM. Membership of the SEM Committee includes both regulatory authorities and external members from Spain. The aim of the consultation is to promote discussion in a market of increasing wind penetration with the goal of dealing with issues in a timely manner. Issues such as the process to secure economic dispatch, firm access, the calculation of the average system marginal price, constraint compensation, and capacity payments will be further developed in 2009 following several meetings held in February.
Author: Martin McCarthy, Sustainable Energy Ireland.