Wind turbine prices fall to their lowest in recent years  

Bloomberg New Energy Finance has an article on falling prices for wind turbines - Wind turbine prices fall to their lowest in recent years.

Prices have dipped below €1m per MW for the first time since 2005, according to the latest edition of Bloomberg New Energy Finance's Wind Turbine Price Index

London and New York – Increasing scale, improved efficiency and over-capacity among wind energy hardware manufacturers have combined to push the average price of onshore wind turbines below €1m ($1.36m) per megawatt.

The fourth issue of Bloomberg New Energy Finance’s Wind Turbine Price Index shows that fierce downward pressure on prices has continued in recent months in all parts of the world. Bloomberg New Energy Finance analyzed confidential data provided by 28 major purchasers of wind turbines. The sample includes more than 150 undisclosed turbine contracts, totaling nearly 7GW of capacity in 28 markets globally – with a main focus on Europe and the Americas.

Dropping turbine prices may be uncomfortable for manufacturers, but it is good news for project developers and it further improves the cost-competitiveness of wind energy compared with gas and coal. The main conclusions of the analysis are:

• Global turbine contracts signed in late 2010 for delivery in H1 2011 and H2 2011 display very aggressive pricing, with average values at €0.98m/MW ($1.33m/MW). This is a 7% decrease compared to contracts signed in 2009 (€1.06m/MW) and 19% down from peak values in 2007-08 (€1.21m/MW).

• The decrease in the Wind Turbine Price Index is partly driven by a larger proportion of US based contracts compared to the previous issue of the Index (July 2010), but pricing remains aggressive in all parts of the world.

• Low-priced power-purchase-agreements in markets with exposure to electricity prices – rather than fixed feed-in tariffs – seem to have put further pressure on turbine contracts: Italy, the UK and the US all display average pricing well below €1m/MW for contracts signed in 2010 for delivery in H2 2011. The US presents the lowest pricing of all markets so far with values averaging $1.27m/MW (€0.93/MW).

• All manufacturers covered by the survey have displayed aggressive pricing, including several contracts for leading ("Tier 1") manufacturers – in some cases below €0.90m/MW ($1.22m/MW).

• The cost of electricity generated from wind is now at record lows: several projects in high resource areas (US, Brazil, Sweden, Mexico) display a levelised cost of energy – excluding the impact of subsidies but after including the cost of capital and maintenance – below EUR 50/MWh ($68/MWh). This compares to current estimated average costs of $67 per MWh for coal-fired power and $56 per MWh for gas-fired power.