Economic implications of inter-farm wake losses

To decarbonize its power sector, the European Union plans a major expansion of wind energy in the North Sea. However, closely spaced turbines can cause wake losses, which may aggregate at the wind farm scale and extend tens of kilometres. This study examines the economic impact of inter-farm wake effects, accounting for the correlation between wind speed and electricity prices. As a case study, we assess the planned Princess Elisabeth Zone (PEZ) and its potential impact on the existing Belgian North Sea cluster. Previous work used the meso-scale climate model COSMO-CLM with the Fitch wind farm parameterization to estimate wind farm energy production for both the current and a potential future layout that includes PEZ. The difference in energy production of the existing Belgian cluster between both runs is attributed to the PEZ’s wake effect and parameterized by wind speed and direction. The energy deficit is applied to ERA5 wind velocity time series, enabling synchronous multiplication with historical electricity prices. We find that energy is lost at about the average price at which wind energy is sold. This price is below the average market price due to a negative wind speed – price correlation. Wind farm owners may thus expect about the same relative revenue loss as their energy deficit. However, different locations for the PEZ as well as higher wind penetration in the electricity market lead to different outcomes, nuancing this statement.