Economics of Wind Integration: An Acceptance Costs Approach

Abstract

Concerns regarding anthropogenic climate change have been a driver for the de-fossilisation of energy systems worldwide. In the case of Denmark, wind energy has played a crucial role on minimising greenhouse gas emissions, and it is expected to continue to play a central role in the transition towards a green, sustainable society. Despite the widespread support for green energy in Denmark at the national level, specific wind energy projects have experienced growing levels of public resistance, which translates into delays and possible cancellations. This situation not only increases the costs of expanding the energy system but reduces support and welfare of the general public. This thesis, as part of theWind2050 project, addresses the duality of global support and local resistance and the associated costs, by utilising a multidisciplinary approach. Thus, it aims at describing preference drivers for wind energy, providing quantitative measures of public resistance stemming from these preferences, and to create cost curves for the deployment of wind energy in Denmark that consider both technical and acceptance costs. The nature of preferences for wind energy requires considering a wide range of fields, from social-geography and psychology to economic valuation and energy cost analyses. Therefore, this dissertation does not focus on developing a single method in depth, but instead on the integration of methods from several fields to provide an exploratory approach towards the creation of quantitative measures of acceptance costs. This doctoral dissertation is composed of two parts: a background introduction of methods and theoretical framework, and six scientific papers. The scientific papers represent the incremental work towards identifying preference drivers for wind energy, creating quantitative measures of acceptance costs, analysing the possibilities of integrating acceptance costs with technical cost curves, and finally identifying policy-related challenges and solutions that would help in achieving a cost-effective wind deployment path for Denmark. Altogether, the results of this thesis indicate that the cost-advantage of offshore versus onshore wind energy in Denmark is not clear-cut across the whole potential range of capacity expansion considered. More importantly, though, it shows that it is possible to incorporate both technical and acceptance costs with consistent results. While providing specific acceptance costs measures and levels, the emphasis of the results is towards the feasibility of such an analysis, and not towards providing accurate measures of acceptance costs for wind energy in Denmark.