Optimal over installation of wind generation facilities

- Installing turbines in excess of a wind farm's Maximum Export Capacity can increase NPV.
- More energy is captured at low wind speeds to offset higher capital costs.
- The valuation effects are modelled under different market structures.
- Over installing is beneficial under FiTs but more so under premia to market prices.
- As decarbonisation progresses the benefit of over installing increases.

This paper evaluates the economic benefits to over-installing turbines on capacity-constrained wind farm sites in order to capture more energy at low wind speeds. Although this implies curtailment at high wind speeds, we show that over installing generation facilities can increase returns to investors and reduce system costs. A detailed model-based analysis is developed using British data, with variations in the range of over installation, the renewable policy support systems (fixed feed-in tariffs or green certificate premia to wholesale energy prices) and the extent of replacement of fossil generation in the technology mix with wind. In the cases of premia to market prices, we use agent-based, computational learning and risk simulation to model market prices. Not only is over installation beneficial under fixed feed-in tariffs, but is more so under premia to market prices and increasingly so as wind replaces fossil generation.