Research Matters No. 49. Wind-Diesel Systems in AlaskaA Preliminary Analysis
More than a dozen wind-diesel systems are generating electricity in remote rural places in western Alaska, and additional systems are being built or planned in a growing number of other rural communities. They are intended to reduce the high cost of electricity in rural Alaska-by reducing the amount of diesel communities need-and at the same time increase the use of renewable energy. Building wind systems is expensive, but once they are in place the cost of wind is stable-unlike diesel prices, which are volatile.
The Alaska Renewable Energy Fund is paying for construction of many systems. The Denali Commission and private industry have also provided funding. But are these systems generating as much power from wind as expected, and are they producing power at lower cost than conventional diesel generators? Researchers at ISER and the Alaska Center for Energy and Power recently did the first multi-system engineering and economic analysis. It's a preliminary analysis, because most of these systems are very new. What did the analysis find?
• The cost of wind energy from existing systems, based on construction costs, ranges from about 7 cents to 53 cents per kilowatt-hour, with the average cost from recently built systems about 14 cents per kilowatt-hour. Energy from newer, larger, or more efficient systems is typically least expensive.
• The average cost of wind energy from recently built systems is comparable, on an energy-equivalent basis, to energy from diesel priced at about $1.90 a gallon. Diesel prices reported by many rural utilities in 2009 were in the range of $4 to $5 a gallon.
• Existing systems generate an annual average of anywhere from 5% to 55% of local electricity, but most generate less than 25%. That percentage is expected to increase, when recently built systems have more operating experience and as new systems come online.
• The best-performing wind systems are those with the strongest wind resources, reliable turbines, experienced developers and utilities, and skilled local operators.
Full report: Alaska Isolated Wind-Diesel Systems: Performance and Economic Analysis, by Ginny Fay, Katherine Keith, and Tobias Schwörer
Institute of Social and Economic Research
University of Alaska Anchorage
3211 Providence Drive
Anchorage, Alaska 99508
Posted: October 4, 2010
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