Peter Lang
21 May 2011

This paper presents a simple analysis to estimate the amount of CO2 emissions avoided by wind generation and the cost per tonne avoided as wind penetration increases from 0% to 20%. The carbon price implications are discussed.

For wind power to be viable in Australia the price for electricity would need to be about $120/MWh. The current average wholesale price of electricity is about $30/MWhi. So wind energy must be subsidised by about $90/MWh. If we have a carbon price of $25/MWh then the Renewable Energy Certificates (RECs) need to reach $65/MWh to make wind viable. (That means the consumer must subsidise wind by $90/MWh, or three times the current wholesale price of electricity.)

The paper concludes that as wind energy penetration increases from 1% to 20% the CO2 avoidance cost increases from $100 to $2,500 per tonne of CO2 production avoided.

Wind energy is a high cost way to avoid CO2 emissions.

For a print-friendly copy of the full article see: http://carbon-sense.com/wp-content/uploads/2011/06/lang-wind-and-emissions.pdf [PDF, 49 KB]