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Hi Jérôme, interesting bit.

Sometime ago I made a back of the envelope calculation on offshore wind costs and got a figure well below 120-130 GBP/MWh. This was based on info you posted on one of the north sea projects, which I can't find at this time :). In any case, this figure is a feed-in tariff, do you have an idea of the real cost? Or maybe how long it thanks for a project to reach break-even with such tariff?

You might find me At The Edge Of Time.

by Luis de Sousa (luis[dot]a[dot]de[dot]sousa[at]gmail[dot]com) on Fri Jul 20th, 2012 at 07:56:02 AM EST
Feed-in tariffs allow investors to get a return on their investment at a lowish rate (7-8% for onshore wind, for instance), taking into account the leverage that can be put in place (again ,for onshore, 80% of debt at 5% cost or so).

Offshore, return expectations are a bit higher (but not that much) and debt is a bit more expensive so you get a average cost of capital at 8-9% rather than 6-7% for onshore.

Tariffs typically last 15 years but can be less.

Wind power

by Jerome a Paris (etg@eurotrib.com) on Fri Jul 20th, 2012 at 12:21:10 PM EST
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