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HEC Paris Professor Sam Aflaki | HEC Paris

New research suggests that increasing costs of large turbines may outweigh their benefits

Energy

A new study published in the Harvard Business Review posits that the costs of maintaining and decommissioning large turbines may eventually surpass the benefits derived from the energy they capture. The research was conducted by professors Sam Aflaki, Atalay Atasu, and Luk Van Wassenhove.

Aflaki is a professor of operations management at HEC Paris, while Atasu and Van Wassenhove hold professorships at INSEAD, an international business school with campuses in five countries. All three scholars specialize in environmental and operational sustainability.

The report draws parallels between the recent expansion of the wind turbine industry and the Pennsylvania oil rush of the 19th century, which left thousands of abandoned oil wells in its wake. The authors write, "In 2021, global wind capacity increased by 94 GW, primarily led by six countries: the United States, China, Germany, India, Spain, and Brazil." They further note that "Over the decade from 2010 to 2021, onshore wind capacity increased four-fold, while offshore capacity grew 11-fold."

According to the study's findings, much of this growth has been driven by manufacturers' efforts to construct increasingly larger turbine blades. "Bigger blades on turbines located farther offshore capture wind more efficiently, require fewer turbines for the same output, and offer more consistent energy generation due to steadier offshore winds," they say. However, they also express concern about escalating costs associated with these larger blades.

The researchers discovered that efficiency gains attributable to size eventually plateau and then diminish as turbines continue to expand. "Put simply," they conclude, "the wind industry’s assumption that bigger is better might simply not be true." They suggest that decommissioning costs could potentially offset any advantages gained from increases in blade size.

Bill Peacock, a policy analyst for the Energy Alliance, says that Texas has seen a significant rise in the number and size of wind turbines. "Texas has tried in the past to require companies to be financially responsible for decommissioning both wind and solar farms," he says. "However, the effort has left a lot of questions unanswered about who will have to pay for disposing wind turbines and solar panels when they reach the end of their lifecycles."

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