An Economic Assessment Framework for Decommissioning of Offshore Wind Farms using a Cost Breakdown Structure

Purpose

As wind power generation increases globally, there will be a substantial number of wind turbines that need to be decommissioned in the coming years. It is crucial for wind farm developers to design safe and cost-effective decommissioning plans and procedures for assets before they reach the end of their useful life. Adequate financial provisions for decommissioning operations are essential, not only for wind farm owners but also for national governments. Economic analysis approaches and cost estimation models therefore need to be accurate and computationally efficient. Thus, this paper aims to develop an economic assessment framework for decommissioning of offshore wind farms using a cost breakdown structure (CBS) approach.

Methods

In the development of the models, all the cost elements and their key influencing factors are identified from literature and expert interviews. Similar activities within the decommissioning process are aggregated to form four cost groups including: planning and regulatory approval, execution, logistics and waste management, and post-decommissioning. Some mathematical models are proposed to estimate the costs associated with decommissioning activities as well as to identify the most critical cost drivers in each activity group. The proposed models incorporate all cost parameters involved in each decommissioning phase for more robust cost assessment.

Results and discussion

A case study of a 500 MW baseline offshore wind farm is proposed to illustrate the models’ applicability. The results show that the removal of wind turbines and foundation structures is the most costly and lengthy stage of the decommissioning process due to many requirements involved in carrying out the operations. Although inherent uncertainties are taken into account, cost estimates can be easily updated when new information becomes available. Additionally, further decommissioning cost elements can be captured allowing for sensitivity analysis to be easily performed.

Conclusions

Using the CBS approach, cost drivers can be clearly identified, revealing critical areas that require attention for each unique offshore wind decommissioning project. The CBS approach promotes adequate management and optimisation of identified key cost drivers, which will enable all stakeholders involved in offshore wind farm decommissioning projects to achieve cost reduction and optimal schedule, especially for safety-critical tasks.