In the last decade, the wind industry has been focussing on cost reduction. This focus has resulted in wind energy now being cost competitive with all other forms of new energy generation.
We have been supporting the cost reduction agenda for the whole of this period. Key has been to focus available resource on the most effective ways to reduce the holistic measure, levelized cost of energy (LCOE, €/MWh). In that debate, we have often needed to help people focus on more important areas than where their early thoughts had led them.
The use of a standard measure allowed the whole energy industry to establish a common language when comparing costs across generation technologies. Focus could then be on actions to reduce cost rather than debating how that cost should be measured. We’ve seen this problem in different markets when talking about local content, were the UK has a clearly defined, rational definition, but many other markets either have less rational or less clear definitions, reading to significantly different claims of local benefit and job creation
Many governmental and commercial organisations have thankfully joined the race to net zero. To support the decarbonisation of the planet, the energy industry needs to establish a universal and straightforward key measure of environmental impact, recognising that there are many different forms of local and global impact. The establishment of this LCOE equivalent for carbon will allow focus on the important areas for carbon reduction. As with costs, these most important areas are often not the most obvious, only informed insight can uncover them.
We suggest that the most effective single ‘currency’ is kg CO2/MWh of energy produced over the whole project lifecycle. This has the benefit of being relatively easy to calculate as well as being easy to understand. This ease will generate wider adoption, greater transparency and fair comparisons. There are some areas where tighter definition are required. For example regarding who takes the benefit of reuse or recycling materials at the start and end of projects. Clarity is actually more important with carbon than cost. Whatever LCOE reduction is modelled, accountants bring the situation back to bottom-line, hard cash in a way that we are far from with carbon.
So it is now time to stop talking about wind simply as zero carbon and to tell it straight, whilst focusing also on how to reduce kg CO2/MWh. We are committed to leading the way, as we did with costs.