Page 313 - Fluid Power Engineering

Financial Modeling of W ind Projects 279

access roads, building of crane pads, improvement of public roads to
transport blades, tower pieces, nacelle, and others.

Substation, Control System, Cables, Installation,
and Others Related to Grid Connection
This cost component includes: Electrical engineering, transformers
(LV to MV) for each turbine, transformer in substation (MV to
HV), switch gear and protection equipment at each turbine and in
substation, SCADA system, meters, underground cables, overhead
cables, fiber-optic cables, FAA lights, and capacitor (if necessary). LV
to MV transformer is usually not included in the turbine price be-
cause the step-up voltage varies by wind farm. Also included in this
category are: Cost of labor to wire the turbine, pull cables inside the
tower, laying of underground power and fiber-optic cables, intercon-
nection to the grid, installation of lightning protection, commissioning
of substation and turbines, communication systems to connect wind
plant’s SCADA system to that of the grid operator, and payment for
grid upgrades beyond the point of common coupling.

Other Costs
Therearetwoclassesofcosts:(i)Costspriortostartofconstructionand
(ii) costs during construction until the end of commissioning. Prior
to construction, the costs incurred are associated with prospecting,
wind measurement, detailed wind study, environmental study, inter-
connection study, soil study, permits, civil and electrical engineering,
cost of other consulting, cost of internal employees, financial mod-
eling, and financing costs. The second class of costs include: Project
management, building of onsite office, insurance against loss or dam-
age of turbine and parts from port until installation, insurance against
construction risks, interest on debt during construction, additional
warranty beyond offered by manufacturer, and additional inventory
of spares. Other miscellaneous costs include, cost of installing perma-
nent met-towers in the wind farm for independently monitoring wind
conditions.

Operating Costs
There are three categories:

Finance charges—payment of principal and interest

Maintenance charges—scheduled and unscheduled

Operations charges—insurance, administration, and manage-

ment of wind farm, transmission cost, land lease payments,
taxes (property, sales)
Finance charges are the easiest to compute, it is a fixed payment
every month to cover the cost of interest and return of principal.