Energy Ventures Analysis was hired this summer to provide the townships impacted by the Canisteo Wind project with an independent estimate for the potential cost of decommissioning the project at the end of its useful life.
The full report can be found here ([download id=”72848″]) and EVA’s expert testimony on the matter can be found at the New York State Department of Public Service’s website. After performing an independent review, EVA concluded that decommissioning the Canisteo Wind Energy Center would cost $18.2 million, or approximately $156,000 per turbine. If the cost to decommission access roads, operations and maintenance building (O&M), and meteorological towers are excluded from the estimate, then it would cost a total of $15.9 million, or $135,700 per turbine.
Decommissioning a power plant or any other major project is a complex undertaking. Developers and communities often disagree about the potential cost of decommissioning a power project because developers can be incentivized to understate the cost to improve potential returns. On the other hand, community members are incentivized to ensure that the project puts aside enough funding to ensure that the project can be adequately removed and that the land can be restored. Moreover, in some cases community members and stakeholders that oppose the fundamental idea of hosting a power project in their area have latched onto decommissioning costs as a potential means of opposing project development.
The importance of independent decommissioning analysis is validated by divergent stakeholder views and the fact that the wind industry has not been prominent long enough for the industry to gain significant experience with decommissioning. EVA’s flagship FUELCAST long-term report expects, under current policy conditions, that wind energy capacity will increase from just above 100 GW in 2019 to nearly 180 GW by 2040. Under such a case, decommissioning or repowering wind turbines will be increasingly important as projects reach their age of retirement.