Experience curves in the wind energy sector use : analysis and recommendations

Abstract

The wind energy sector is one of the fastest-growing energy sectors in the world. Both prices of wind turbines and cost of wind-generated electricity have dropped significantly over the last twenty years. However, electricity from wind is not yet fully able to compete with fossil fuel based electricity. In order to be able to forecast the development of the cost of both the cost of wind turbines and the cost of electricity, use is made of so-called experience curves. Basically this concept analyses how much costs have dropped with every doubling of the cumulative production. On the basis of recorded data on cumulative production of a certain product and accompanying g drop in costs per product, a historic experience curve can be constructed. Historic experience curves are used in literature for a number of models and scenarios to predict the future development of wind power (e.g. [EWEA, 1999a], [Ybema et al., 1999], [Neij 1999]). The outcome of these models and scenarios are strongly influenced by the so-called progress ratio, which determines the drop in cost with every doubling of cumulative production. Also, experience curves are often based on highly aggregated data, and may include large uncertainties. In addition, data may be difficult to obtain in many countries. Therefore experience curves are often based on the data from a single country. Also it is questionable to what extent learning curves derived from data in one country can be used for a global model. In summary, it is unclear what the possible uncertainties are, and thus how accurate current predictions based on experience curves are. The objective of this paper is first to analyze and discuss how experience curves are currently used in studies on wind energy. Based on this overview it is formulated what lessons can be learned to use experience curves for future predictions.