How long can wind turbines recover their costs?
The cost recovery time (i.e. investment payback period) of wind turbines is influenced by various factors, typically ranging from 5 to 15 years, depending on the following key factors:
Main influencing factors
1. Wind turbine scale and type
Small wind turbines (such as household or community use): have a small capacity (usually<100 kW), may have a longer payback period (more than 10 years), and are highly dependent on local subsidies and electricity prices.
Large onshore wind power (commercial wind farm): with a large capacity (2-5 MW or more), significant economies of scale, and a short payback period, usually 5-10 years.
Offshore wind power: Although it generates more electricity, the construction and operation costs are high, and the payback period may reach 10-15 years.
2. Wind resource conditions
The higher the average annual wind speed (usually>6 m/s), the greater the power generation and the faster the recovery. Regions in China with abundant wind resources, such as Inner Mongolia, Xinjiang, and coastal areas, have shorter recovery periods.
3. Initial investment cost
Including wind turbine equipment, infrastructure, power grid connection, etc. The investment per kilowatt of onshore wind power is about 6000-9000 RMB/kW, while offshore wind power may reach up to 15000-20000 RMB/kW.
4. Electricity prices and subsidy policies
In the era of parity grid connection: After 2021, China's newly approved onshore wind power has completely eliminated national subsidies and relies on local coal-fired benchmark electricity prices (about 0.3-0.45 yuan/kWh).
Existing projects: Early projects enjoy fixed electricity price subsidies (such as 0.5-0.6 yuan/kWh) for faster recovery. Some regions still have local subsidies.
5. Operation and maintenance costs and reliability
The average annual operation and maintenance cost accounts for about 2-4% of the investment amount. The maturity of wind turbine technology (such as the difference between direct drive and doubly fed models) affects the failure rate and long-term benefits.
6. Financing costs and loan interest rates
Low interest loans or green finance support can shorten the payback period.
Simplified calculation example
Taking a 3 MW onshore wind turbine as an example:
Investment cost: Approximately 18 million yuan (estimated at 6000 yuan/kW).
Annual power generation: approximately 7.5 million kWh (with 2500 hours of utilization and moderate wind speed).
Electricity price: 0.35 yuan/kWh (grid parity).
Annual income: 7.5 million kWh x 0.35 yuan=2.625 million yuan.
Annual operation and maintenance cost: calculated at 3% of the investment amount, approximately 540000 yuan.
Net annual income: approximately 2.085 million yuan.
Simple payback period: 18 million yuan ÷ 2.085 million yuan ≈ 8.6 years.
(Note: Complex financial models such as taxes, depreciation, and loan interest have not been considered)
Industry Trends and Prospects
1. Technological progress: Large capacity, low wind speed wind turbines improve power generation efficiency, with initial investment decreasing year by year.
2. Green electricity trading and carbon market: In the future, wind power participating in green electricity trading or carbon reduction trading may increase additional revenue.
3. Policy support: Some regions provide subsidies for wind power supporting energy storage, but it will also increase costs.
Conclusion
Onshore wind power: With good resources and no subsidies, the payback period is generally 7-10 years; Projects with historical subsidies can be shortened to 5-8 years.
Offshore wind power: Due to its high cost, the payback period often exceeds 10 years, but its long-term stability is higher.
Small scale distributed wind power: The economy is highly dependent on local policies, and the payback period fluctuates greatly.
Specific projects should be calculated in detail based on local resources, policies, and financial models. In recent years, with the large-scale development of wind turbines and the maturity of the industrial chain, the cost recovery cycle of wind power has shown a trend of shortening.
