Project Financing & Economics

Production Tax Credit (PTC) vs. Investment Tax Credit (ITC) – You can’t have both

Evaluating which incentive offers the greatest financial benefit to your project
July 7, 2009

The passage of the American Recovery and Reinvestment Act (ARRA) of 2009 brings both change and confusion to the process of selecting the most beneficial incentives for wind projects. In the past, only the PTC was available for wind projects over 100kw. Now with the addition of the ITC, it is important to quantify the relative value of the PTC in comparison to the ITC so you can make the best decision for your project. The important factors to consider when evaluating your options are cost of installation and the expected capacity factor (which determines the amount of energy that the project will produce). Read More

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Will your small wind investment pay off?

Items to consider before diving into a small wind project
June 5, 2009

Small wind turbines – those with power ratings of less than 100 kW – are being installed at a rapid pace.  Unfortunately, a large fraction of these projects produce less energy than advertised as a result of insufficient upfront planning and analysis.

WECC's "Common Mistakes to Avoid in Your Small Wind Project" provides simple steps that can be taken to ensure a more viable project from the performance and financial perspectives. Have you done your homework?…Learn more about how to realize a positive economic return from your small wind project. 

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Energy, Economic Impact of the Stimulus, and Enthusiasm
May 18, 2009

An Overview of the American Recovery and Reinvestment Act (ARRA) of 2009 – The Stimulus Legislation… in recap form is now posted on our website “from beginning to wind.com.” It relates to both the features of the stimulus legislation that apply to the tax-paying segment and features that apply to the tax-exempt segment is now posted on our website It provides an update on the extension of the Production Tax Credit and the expanded Investment Tax Credit are described here. In addition the update describes some additional aspects of the incentives and features of the stimulus package that are favorable for those involved in wind energy projects. Read More

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WECC answers questions about LEED building

LEED building with or without renewable energy?
April 30, 2009

Often when a "design and build" company evaluates alternative design options in order to reach a LEED certification goal, renewable energy components drop out because they are too costly.  However, upon completion of a more sophisticated financial analysis, a LEED design with renewable energy can be less costly in the long run.

WECC's "Renewable Energy and LEED Certification" describes the connection between renewable energy and LEED points and describes ways to finance a renewable energy project that does not impact the cost...Learn more about incorporating clean, renewable energy into your LEED design.

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Renewable Energy and Leadership in Energy and Environmental Design (LEED) Certification
April 28, 2009

In the recent years there has been a big push toward attaining LEED certification of buildings. In this entry I will describe the connection between renewable energy and LEED points, and describe ways to finance a renewable energy project that does not impact the cost.

When a "Design and Build" company proposes a LEED design to a developer, it chooses the most cost effective components of the design such that the points add up to the desired LEED level. For instance, if a designer wants to achieve a Gold level of LEED certification, then it needs 39 to 51 points. Inserting renewable energy generation into a project is a very expensive way to achieve this Gold target. There are several other significantly less expensive design options to accomplish the same goal. Read More

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Cost of Energy for Small Wind Projects
April 17, 2009

In this entry I will talk about the cost of energy for small wind projects. The previous blog addressed how the cost of energy is computed and presented the cost of energy generation for utility scale turbines. The focus of this blog entry will be on turbines that are rated 10KW or less.

To recap, the cost of energy production depends on average annual energy production (AEP), total cost of installation, recurring cost for operations and maintenance, and the discount rate. Read More

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Cost of Producing Wind Energy
April 10, 2009

In this entry I will describe how the cost of generating energy is computed, compare the cost of alternative sources of generating energy, and provide estimates for cost per kWh of energy from distributed wind projects of size 1MW to 3MW.

The debate about comparing costs of energy can become heated.  People with vested interests in a project naturally want to predict lower cost per kWh for their favorite generation method and predict higher cost per kWh for the rest.  In this article we will present a range of costs for comparison purposes.  WECC understands wind energy and is very familiar with the various wind energy project costs; we rely on independent sources for costing information about non-wind projects. Read More

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Economics of a Wind Project
March 27, 2009

In this blog I will discuss the economics of a wind project, with a focus on total installed cost of a wind project.

The most recent source of total installed cost of wind project is from the January 2009 issue of WindPower Monthly.  It reported that the average total cost of fully installed projects in 2008 was 1,502 Euros per KW (or $1,950/KW at 1.3 conversion rate).  The average was take over 3,600MW of installs worldwide in 2008.  The range of costs was 1,300 to 1,700 Euros per KW.  Although this data is skewed towards large wind farm projects, it serves as a lower bound for a community wind project of size 1 MW to 10MW. Read More

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Dr. Pramod Jain chosen to present at LAWEA workshop

Huatulco, Oaxaca
March 26-27, 2009

Dr. Pramod Jain, WECC's chief technology officer, will present "Locale Specific Parameters in Financial Modeling of Wind Projects" at LAWEA's first technical workshop in Huatulco, Oaxaca.   The goal of the workshop is to explore development of a wind farm, from its analysis, evaluation and study, to its implementation, operation and maintenance.  Each topic is discussed by leaders of wind development in Latin America. Read More

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