WIND FARM DECOMMISSIONING: A PERSPECTIVE ON REGULATIONS AND

WIND FARM DECOMMISSIONING: A PERSPECTIVE ON REGULATIONS AND

WIND FARM DECOMMISSIONING: A PERSPECTIVE ON REGULATIONS AND

COST ASSESSMENT IN ITALY AND SWEDEN

Dissertation in partial fulfillment of the requirements for the degree of

MASTER OF SCIENCE WITH A MAJOR IN ENERGY TECHNOLOGY WITH FOCUS

ON WIND POWER

Uppsala University

Department of Earth Sciences, Campus Gotland

Gabriele Giovannini

2014/09/09 i

WIND FARM DECOMMISSIONING: A PERSPECTIVE ON REGULATIONS AND

COST ASSESSMENT IN ITALY AND SWEDEN

Dissertation in partial fulfillment of the requirements for the degree of

MASTER OF SCIENCE WITH A MAJOR IN ENERGY TECHNOLOGY WITH FOCUS

ON WIND POWER

Uppsala University

Department of Earth Sciences, Campus Gotland

Approved by:

Supervisor, Liselotte Aldén, Heracles Polatidis

Examiner, Simon-Philippe Breton

2014/09/09 ii

ABSTRACT

Due to a lack of knowledge and experience the best approach to deal with wind farm decommissioning has yet to be determined. To fill this void, this paper analyzed the current status in terms of regulations and cost, regarding the decommissioning in Italy and Sweden.

In order to make a comparison between these two countries, the available research papers and reports on the decommissioning cost assessment, removal methods and regulations were thoroughly investigated. Moreover, detailed estimated dismantling cost data was obtained from a wind farm in Italy.

The Italian cost data were compared with data collected in Sweden and along with them, the regulations and legislations related to how these costs have to be assessed as well as what developers are required to do regarding the decommissioning in the permit issuance were included.

The results of this research show that in decommissioning cost assessment both countries does not allow developers to include the possible revenues due to the scraps and to the recycling of components, although totally different methods are pursued.

Some kind of security to ensure that decommissioning occurs is required, normally a bond.

The bond amount is a debt investment in which an investor loans money to an entity

(corporate or governmental) that borrows the funds for a defined period of time at a fixed interest rate. In Italy the bond requirements are generally high and it has to be paid completely for the permit issuance. In order to develop significant projects, this kind of approach leads to discourage small investors.

On the contrary, in Sweden the current amount of 300.000 SEK per turbine according to the court precedent, the most widespread during the approval of the permit, is definitely low and represent a level playing field for every investor. Swedish regulations are also more flexible and only in the 28% of the cases studied between the years 2009 and 2012, the entire amount of the bond had to be assured before the installation. However, the malleability with regard to wind farms that do not need to provide any security, together with the low bond amount might endanger the decommissioning accomplishment. iii

ACKNOWLEDGEMENTS

This paper is the result of many hours of work and it would have not been possible without the support and guidance of several people. First, I would like to acknowledge my family for their overall support and their help since the beginning of the Master Programme.

I would also like to acknowledge my classmates and the teaching staff in the Wind Power department for their assistance and perspectives. With special thanks to Liselotte and

Heracles for their feedbacks, suggestions and improvements on the development of this paper.

A special thank you must also be extended to Tèkne s.r.l, especially Mariagrazia Falco, for generously providing the actual information I used as the basis for this paper. iv

TABLE OF CONTENTS

ABSTRACT ............................................................................................................................ iii

ACKNOWLEDGEMENTS ................................................................................................... iv

TABLE OF CONTENTS ........................................................................................................ v

LIST OF FIGURES ................................................................................................................ vi

LIST OF TABLES ................................................................................................................. vii

1 INTRODUCTION................................................................................................................. 8

2 LITERATURE REVIEW .................................................................................................... 9

3 METHODOLOGY AND DATA ....................................................................................... 33

4 APPLICATION OF THE METHODOLOGY AND RESULTS ................................... 35

4.1 Italian regulations on decommissioning ................................................................................. 35

4.2 Swedish regulations on decommissioning ............................................................................... 36

4.3 Italian decommissioning cost assessment ............................................................................... 40

4.4 Swedish decommissioning cost assessment ............................................................................. 41

4.5 Comparison between the Italian and the Swedish decommissioning cost ........................... 42

4.5.1 Italian decommissioning cost........................................................................................................... 43

4.5.2 Swedish decommissioning cost ........................................................................................................ 47

5 DISCUSSION AND ANALYSIS ....................................................................................... 51

5.1 Results from the decommissioning regulations ...................................................................... 51

5.2 Results from the decommissioning cost assessment ............................................................... 52

5.3 Results from the decommissioning cost .................................................................................. 53

6 CONCLUSIONS ................................................................................................................. 56

REFERENCES ....................................................................................................................... 59

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LIST OF FIGURES

Fig. 1. Deconstruction process of an offshore wind farm: Utgrunden, Sweden. .............. 14

Fig. 2. Key profitability drivers of Offshore Wind Parks. ................................................. 16

Fig. 3. Normalized minimum bonding requirements and reclamation/decommissioning costs. ........................................................................................................................................ 20

Fig. 4. Annual evolution of total accidents/incidents occurred related to wind power industry in absolute numbers (top) and parameterized by the installed capacity

(bottom). .................................................................................................................................. 23

Fig. 5. Annual evolution of human fatalities occurred related to wind power industry in absolute numbers (top) and parameterized by the installed capacity (bottom)............... 24

Fig. 6. Framework for Restoration and Decommissioning Plan. ...................................... 32

Fig. 7. Methodology Flow Chart. .......................................................................................... 34

Fig. 8. Wind farms’ classification with respect to license permits regulations. ............... 38

Fig. 9. An overview of the decommissioning processes....................................................... 42

Fig. 10. Cost breakdown of the Italian wind farm decommissioning. ............................... 46

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LIST OF TABLES

Table 1. Disposal options by component (U = unlikely). ................................................... 10

Table 2. Estimated onshore component cutting costs. ....................................................... 11

Table 3. Expected cost for three decommissioning scenarios at Cape Wind (Felling option cost denoted in parenthesis). ..................................................................................... 12

Table 4. Expected cost for Wind Turbines and Hardstandings areas removal. ............. 44

Table 5. Expected cost for Cables removal. ........................................................................ 44

Table 6. Expected cost for Substation removal. ................................................................. 45

Table 7. Expected cost for Roads removal.......................................................................... 45

Table 8. Expected cost for Transformer removal. ............................................................. 46

Table 9. Swedish wind farms decommissioning. ................................................................ 47

Table 10. Swedish wind farms estimated decommissioning cost. ..................................... 49

Table 11. Swedish wind farms actual decommissioning cost. ........................................... 50

Table 12. Wind farms decommissioning cost. .................................................................... 54

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1 INTRODUCTION

The wind power industry is currently growing all over the world and as wind farms are installed it is evident that at the end of their useful lifetime they will have to be decommissioned. Especially in the last years the wind power sector has experienced a steady growth and considering the wind turbine lifetime of 15-25 years, the time to be ready to deal with a large number of decommissioning cases might not be enough if governments do not start now to face this issue.

Unfortunately, nowadays there is still a clear lack of practical knowledge and experience about the economic consequences of such dismantling.

Technically, the developer is supposed to take care of the removal of the wind farms but what would happen if the operator is unable to meet its obligations or goes bankrupt?

Who is supposed then to carry out the decommissioning and in which way governments can tackle this event?

This paper is primarily an empirical quantitative study of estimated decommissioning data provided for a specific wind park in Italy and aims to start filling the knowledge gap by comparing regulations and procedures both in Sweden and in Italy.

Moreover, the analysis intends to understand how Swedish and Italian governments deal with the decommissioning and which measures are undertaken to prevent wind turbine from being abandoned to rust.

This comparison is intended to investigate the regulations that developers are required to follow in order to assess the decommissioning cost and to secure the necessary amount of money for future dismantling operations.

Finally, the cost related to the dismantling is then compared with data collected from Italy and Sweden.

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2 LITERATURE REVIEW

Several authors have addressed the issue of wind farms’ decommissioning in order to assess the future cost that developers will incur at the end of the wind farm operational life. In addition, other concerns such as how to grant the funds needed for the dismantling as well as the necessity of standard procedures and an optimization of the whole decommissioning phase have been highlighted.

Looking at the possible methods for cost analysis, different authors started to estimate a possible cost associated to the dismantling. For example several authors aim to explain how to estimate the decommissioning cost for the U.S offshore wind farms in order to establish the size of the bond that provides financial security to help ensure decommissioning obligations are carried out in the event the operator is unable to meet its obligations or goes bankrupt. The main assumption is that decommissioning operations will be performed in stages similar to installation but in reverse (Kaiser, M.J. & Snyder, B., 2012).

Turbine deconstruction will likely proceed as follows: provide erosion control; widen road to accommodate crane, if necessary; assemble the crane; remove electrical components and internal cabling; and lower the blades, nacelle, and tower sections to the ground.

The removal costs for each component has been assessed by using a specific model and each component may have removal, processing, and either disposal costs or scrap revenues.

While the removal costs are a function of the work duration per unit, the number of units and the day rate of the vessel conducting the work, the processing and disposal costs and scrap revenue are calculated separately for each component on a price per ton basis.

For each component the total costs of decommissioning are the sum of the costs of all removal, processing, disposal and scrap modules. One of the uncertainties of this paper is related to the project engineering and management and port rental cost that are not considered and may add 10% to the total cost estimate.

The study entails the following decommissioning stages:

1.

Turbines

2.

Foundations

3.

Cable

4.

Substation and met tower

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5.

Scour protection

6.

Site clearance

For each stage, Kaiser and Snyder analyzed all the possible decommissioning models by specifying the removal vessel type and they defined the input physical parameters for each phase like the distance to the port, the wind farm capacity, the turbine capacity etc.

Afterwards, the cost analysis was possible through the parameterization, namely by collecting the times needed for the dismantling operations and the current costs related to the different vessels.

Once the cost of the previous stages has been assessed and all the wind turbines components have been transported ashore, the material disposal costs have to be included.

According to the Kaiser and Snyder, the disposal costs consist of three components: processing costs, transport costs and scrap profits or landfill costs. There are several disposal options for wind farm components (Table 1) and the ultimate disposition of each component will determine total cost.

Table 1. Disposal options by component (U = unlikely).

Component Reef Landfill Scrap Leave in place

Turbine Blades

Turbine Nacelle

N

N

Turbine Tower N

Monopile-transition piece assembly Y

Monopile

Cables

Scour protection

Substation foundation

Substation topsides

Y

N

N

Y

N

U

Y

U

U

Y

Y

Y

U

Y

Y

N

Y

Y

N

N

Y

Y

Y

N

Y

Y

N

N

N

N

N

N

Source: Kaiser, M.J. & Snyder, B. - 2012

In the table 1 the term “Reef” indicates that components could be left in situ to create an artificial reef.

Regardless the type of the wind farm (onshore or offshore), the material to be scrapped or landfilled incurs processing costs. Whereas for landfilled material, processing consists of

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cutting the pieces into lengths and weights transportable by truck, for scrap steel, processing will involve cutting pieces into suitable sizes to be accepted by mini-mills (typically 2 ft x 5 ft). Processing costs may be estimated on either per foot or per ton basis.

Neglecting the tools and methods, it is worth to mention the formula introduced by Kaiser and Snyder to calculate the total length of cut required to decompose a tubular member into pieces that can be accepted by a mini-mill.

Min + 1 + , + 1 +

(1)

Where D is the diameter, C is the circumference; L is the length of the tubular member, X the length and Y the width dimension of a final cut piece, all in the same units.

Min indicates the component with the smaller value should be selected.

Knowing the cut rate and the labour cost per hour (Table 2) it is possible to estimate the total processing cost.

Table 2. Estimated onshore component cutting costs.

Component

Tower

Monopile

Monopiletransition piece assembly

Thickness

(cm)

3

5

5+7+5

Cut rate

(cm/s)

0.5

0.2

0.2, 0.15, 0.2

Material

3

8

8+10+8

Cost ($/ft)

Labor

0.4

1.1

3.6

Total

3.4

9.1

29.6

Source: Kaiser, M.J. & Snyder, B. - 2012

In brief Kaiser and Snyder assessed the decommissioning cost for an offshore wind farm analysing three different scenarios. In the first scenario, the cable and scour protection are removed; in the second scenario, cable and scour protection are left in place; and in the third scenario, the turbine felling option (cutting down the wind turbine as a tree) is employed

(Table 3). The felling option costs are denoted in parenthesis.

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Table 3. Expected cost for three decommissioning scenarios at Cape Wind (Felling option cost denoted in parenthesis).

Removal

Removal

Stage

Disposal

Disposal sub-total

Total cost

Component

With cable removal

(million $)

Cost Revenue

Turbines

Foundations

Substation

Cable-export

Cable-inner-array

Met tower

Scour

Site clearance

Sub-total

Turbine-nacelle and blades

Turbine-tower

Foundation

Substation-jacket

Substationtopsides

Cable-export

Cable-inner-array

48.7 (22.1)

9.1

0.5

1.2

6.9

0.2

1.9

2.1

70.5 (43.9)

2.1

0.004

0.15

1.4

4.0

2.0

0.14

0.08

0.19

2.5

65.5 (38.9)

7.5

Source: Kaiser, M.J. & Snyder, B. - 2012

48.7 (22.1)

9.1

0.6

0.3

2.1

60.6 (34.0)

2.1

0.04

0.15

2.3

55.4 (28.8)

Without cable removal

(million $)

Cost Revenue

1.4

4.0

2.0

0.14

7.5

According to the paper, the model is parameterized with data from four (4) proposed U.S. offshore wind farms and decommissioning costs are found to range from 115,000 to 135,000

$/MW, approximately 3–4% of estimated capital cost.

The wind turbine decommissioning has been also investigated with respect to the offshore wind development in the UK (Pearson, 2001). Pearson aims to illustrate the key areas that will need to be addressed in preparing plans for the decommissioning of the wind farm.

Additionally, it points out ways in which the dismantling process can be made simpler by pinpointing both current legislation and offshore techniques as a baseline.

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In the UK as well as in the rest of the world there is a little regulation specific to the decommissioning lifecycle stage of offshore wind parks but it can be anticipated that offshore regulations will have something in common with the ones of the well-developed oil and gas licensing and environmental protection regimes.

In this case the “felling option” (cutting down the wind turbine like a tree) is not taken into account according to Pearson:

Whilst the same level of care may not be necessary as is required during

installation, any attempt to cut corners on procedures or equipment size during dismantling is likely to compromise safety, and for the purposes of this study it was assumed that decommissioning will be undertaken in an entirely controlled manner, with each component being unbolted and carefully lowered onto a barge for transport away from the

site(Pearson, 2001).

Then, it can be deduced that the time needed for the dismantling will be roughly the same that was employed in the installation.

Even in this report it is assumed that the decommissioning process will largely be a reversal of the installation process (Figure 1) and will be subjected to the same constraints.

The final costs (between £118,000 and £132,000 per turbine) were based on method statements

1

developed from the preliminary foundation designs, and rates provided by two contractors.

1

A Method statement is the description of procedures and safety precautions.

13

Fig. 1. Deconstruction process of an offshore wind farm: Utgrunden, Sweden.

Source: Pearson - 2001.

Even though the author does not explain in detail how they came up with the cost presented in the report, the following assumptions were made:

1.

Decommissioning is a one-off-cost.

2.

Marine installation technology is expected to become more cost effective.

3.

An assumed discount rate of 2% was used to calculate future costs from present costs discounted over the lifespan of the project (25 years).

4.

The electrical cable remains in situ.

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According to Pearson, “decommissioning should not be seen as simply a process of removing structures because it is a complicated process that takes into account many legal, geophysical, technical and financial considerations”.

Among the costs related to the wind farms, the dismantling one is the most uncertain as pointed out by Prässler and Schaechtele 2012.

Employing a DCF (discounted cash-flow) model, this paper scrutinizes how national regulations and geographic conditions of designated national offshore wind development areas affect profitability.

Looking at the breakdown structure in Figure 2, the profitability has been divided in two branches: revenues and costs. In the revenues are included both the quantity of electricity generated, therefore related to the wind resource, the turbine efficiency and the energy loss factor, and the remuneration per unit of electricity produced.

The last one contains the profit coming from the electricity wholesale price and the support scheme.

Conversely, the total cost related to the wind farm development has been split in three major cost buckets: (a) initial capital costs to plan and construct the wind farm; (b) annually occurring variable costs, which mainly arise from operation and maintenance (O&M) activities; and (c) dismantling costs arising at the end of lifetime.

Nowadays the most uncertain among costs is the dismantling. This is due to a lack of experience in decommissioning activity, although Denmark and Germany have already dealt with the dismantling of small wind turbines.

As a consequence of this, it is not so reliable just scaling the price with respect to the size because the new wind turbines show a different layout. Indeed they need special equipment in order to be dismantled that increases significantly the cost compared to the smaller ones.

Especially in offshore projects, there is little information on dismantling costs as they are absent in many reports. The few reports in which dismantling costs are quantified range from assuming no dismantling costs at all because the residual value of the components will compensate for the dismantling cost to 0.2 million EUR per MW (Prässler, T. & Schaechtele,

J., 2012).

15

Fig. 2. Key profitability drivers of Offshore Wind Parks.

Source: Prässler, T. & Schaechtele, J. - 2012

According to the paper, it is hard to believe that the residual value of the wind turbine will cover the dismantling cost, considering that the scrap material market is always fluctuating and therefore uncertain.

There are also authors that are addressing the wind farm decommissioning by comparing and learning from the past development of oil and gas projects (Kaiser, M.J. & Snyder, B., 2012).

They give an overview of the expected workflows and stages of decommissioning that are likely to arise for offshore wind farms, to describe the exposure and liability of the parties involved and to compare offshore wind and oil and gas decommissioning.

Generally speaking, offshore decommissioning operations in the oil and gas industry are usually low-tech and routine involving standard equipment and procedures. Indeed, the physical requirements of decommissioning and the processes involved have not changed for decades. The time needed for the operations ranges from a few days to several weeks.

16

As regards offshore wind farm, the decommissioning is also expected to be low-tech and routine, but will occur on a much larger spatial and temporal scale than oil and gas projects.

Once the costs have been assessed, it is necessary to secure the amount of money needed for the decommissioning. Indeed, in the decommissioning regulations, the surety bond plays a fundamental role.

According to the report, from the operator’s point of view, decommissioning activities represent a cost to be incurred in the future, while from the government’s perspective, decommissioning represents an uncertain event and a financial risk if the operator becomes insolvent or cannot meet its financial obligations under the lease.

For this reason, state and federal governments require companies to post a decommissioning bond at the time of construction to ensure that adequate funds exist to remove infrastructure in the future. The level of the bond is usually set at the expected cost to decommission the facilities and may be inflation-adjusted.

Surety bonds are agreements between three parties. These parties are the operators

(principal), who are obligated to conduct decommissioning activities in accordance with their lease agreement, the government, who acts as an agent of the landowner and is required to ensure successful operations (obligee), and an insurance company (surety), which ensures that money, exists to complete decommissioning activities, regardless of the financial capacity of the principal.

As regards the stages of decommissioning, Kaiser and Snyder entail that the turbine removal is expected to follow the same process as installation, but reversed. Nevertheless, the needed removal times are expected to be smaller than installation times because removal operations occur at the end of the useful life of equipment and are not expected to be as delicate as installation.

Besides the classical removal that consists in carrying on the dismantling as the installation but in reverse, the alternative removal method consists in cutting down the turbine in a manner similar to cutting a tree, thereby removing costs associated with disassembly and lifting with heavy-lift vessels, has been suggested.

17

The turbine tower will be cut and allowed to fall in a controlled manner into the ocean similar to methods developed for reefing-in-place oil and gas structures. Although this is strictly related to an offshore wind farm, a similar solution might work for the onshore wind farm as well.

As regards the material disposal, the authors mention four (4) different methods of disposal for steel and other materials associated with an offshore wind turbine: refurbish and reuse, scrap, dispose of in designated landfills, or place offshore as an artificial reef. The first option, the refurbish and reuse, is not usually considered as a viable solution especially for offshore wind parks.

Turbine components, foundations and transition pieces, and power cable are expected to be extremely limited due to the age of the components at the time of removal, the nature of its assembly and the corrosion arising from operating in a marine environment. However, this might be feasible for onshore wind farms considering the less aggressive environment. As a consequence of this, all the materials that are expected to be landfilled disposal would represent revenue instead of expenditure.

A thorough analysis between wind park and oil and gas projects has been also undertaken in

USA (Changala, D. et al., 2012). Considering the worldwide growth of renewable energy projects, adequate funds to successfully decommission projects at the end of their useful life have to be secured. It is also fundamental to ensure that regulatory decommissioning obligations do not disproportionately burden any generation resource.

According to Changala et al it is necessary to develop a policy environment that not only allows an easier integration of renewable energy into the electric grid, but also provides a regulatory system that ensures environmental accountability and a level playing field amongst domestic energy resources.

Furthermore, Changala et al focus on the decommissioning requirements governing energy generation projects because they are an imperative component of such a regulatory structure.

Sufficient funds and requirements have to be secured for reclamation and decommissioning costs in order to ensure that wind projects will not be left without appropriate securities at the

18

end of their life. Of course, these assurances must be similarly imposed on all energy resources, avoiding fostering particular resource over another.

In this paper the comparative analysis between oil and gas and wind project decommissioning has been carried out because wind projects and O&G extraction sites have some resemblances in their surface land use patterns. Indeed, the installation and operation processes of each entails the removal of topsoil from the well/turbine site, laying a cement/gravel pad (well pad for O&G, tower foundation for wind turbine), and the construction of roads and access ways for site construction and maintenance.

Usually, during the application and planning process for O&G operations, the BLM (Bureau of Land Management) requires that O&G operators provide a bond to the agency to ensure that there are adequate funds available to accomplish the required reclamation and fulfil all other terms and conditions of the lease, including payment of federal royalties.

Nevertheless, the regulatory minimums were set in the 1950s and 1960s, leaving the minimum bonding amounts very outdated and not reflective of actual reclamation costs.

As regards the wind energy developments on federal lands, they require two specific bonding requirements. The first one is required for site testing and monitoring authorizations (a minimum of 2000 $ per meteorological tower), while the second one is needed for the ROW

(right of way) authorization (a minimum of 10.000 $ per wind turbine considering salvage values of turbines and towers). However, the precise amount of the bond is determined by site-specific and project-specific factors during the ROW authorization process. The BLM periodically reviews, at least every five years, all bonds in order to ensure the adequacy of the bonds.

Usually, dismantling operations consist of the dismantling and removal of the generators, tower, transformers and cables (overhead and underground), the removal of foundations, buildings, and ancillary equipment as well as the removal of surface road material, including the restoration of the roads and turbine areas to a substantially similar condition prior to the construction of the wind farm. In the dismantling operations are also included the reinstatement of the topography of the site, restoring of the topsoil and reseeding the surface to restore the natural environment. The aim of decommissioning is to reinstate the turbine area to the physical condition of the land as it was prior to construction of the wind farm.

19

Generally, wind projects are characterized by a higher minimum bond requirement than O&G projects creating a greater likelihood that decommissioning will restore the site to its prior condition.

The following Figure 3 shows the normalized minimum bonding requirements compared to the real decommissioning costs for wind turbines and O&G wells. It is clear how the current bonding requirements for wind will also likely be insufficient.

Fig. 3. Normalized minimum bonding requirements and reclamation/decommissioning costs.

Source: Changala, D. et al – 2012.

It is clear how the current bonding requirements for wind and O&G development promote inadequate environmental protection, as the required bonds will not likely cover the full costs of reclamation and decommissioning.

Because of this, some states like Indiana and Vermont condition the approval of renewable facilities on the establishment of a decommissioning plan and financial assurance. In order to receive the approval by the state utility regulatory body in Vermont, the Vermont Public

Service Board (PSB), energy facilities must receive a ‘‘certificate of public good’’, which

20

must include a detailed cost assessment of decommissioning, as well as a mechanism to guarantee a secured fund to be available when decommissioning occurs.

In sum the comparison of federal, state, and county decommissioning regulations for O&G extraction sites and wind energy projects reveals that, generally, regulatory requirements are wholly insufficient to adequately secure the costs of decommissioning.

The decommissioning is a multifaceted issue that might imply even societal risk. Even though these kinds of risks embrace the whole life of the wind farm from the installation to the decommissioning, a standardization of the dismantling procedures can help to reduce these circumstances.

The quantitative risk measure of societal risk based on wind farms historical accident data has been presented by Moura Carneiro et al 2013. The authors referred to the CWIF (Caithness

Wind Farm Information Forum), a database where information on accidents, incidents and fatalities related to wind energy technology is collected from the 1970s to October 2001.

The data were presented in its absolute values and normalized by the capacity of wind power installed worldwide over the years (Moura Carneiro et al, 2013).

It is widely agreed that among its benefits the wind energy has no radiation hazards; the source is free, incurs no transport costs and produces some of the lowest rates of pollution/thermal emissions for electric-power generation into the atmosphere or nearby water resources. These are some of the reasons that explain why the wind power plants are increasing exponentially worldwide. Maintaining the current growth necessitates research into the management of economic and environmental risks associated with the operation of large-scale commercial wind ventures.

The term risk usually expresses not only the potential for an undesired consequence, but also how probable it is that such a consequence will occur, while the term hazard expresses the potential for producing an undesired consequence without regard to how likely such a consequence is.

21

Risk has been considered as the chance that someone or something that is valuated will be adversely affected by the hazard, while hazard is any unsafe condition or potential source of an undesirable event with potential for harm or damage.

Risk management is a tool that can be used to determine the risks associated with the hazards in any work process, machine, or chemical process. Risk assessment is a part of risk management. Once the hazards are identified, the risk assessment can be performed.

Furthermore, risk assessment is an essential and systematic process for assessing the impact, occurrence and the consequences of human activities on systems with hazardous characteristics.

The main contribution of the article is the presentation of the quantitative measure of possible societal risk associated with wind turbines based on documented historical accident data.

While statistics on accident rates (accident per inventoried capacity per year) should be considered inaccurate, these data may give a satisfactory description of the types of accidents which can occur, as well as their consequences.

The historical analysis specifically on wind turbine accidents was performed using the CWIF

(Caithness Wind Farm Information Forum) database. This database includes all documented cases of wind turbine related accidents that can be found and confirmed through press reports or official information releases. Such events include human casualties or damages to the plants, properties or the natural environment.

The analysis allowed the identification of the most diffused causes (historically). First, according to the CWIF database, the main consequences of accidents and/or incidents can be classified into two groups: damage to life (impacts on wildlife, human injury, fatal accidents) and damage to property (blade failure, miscellaneous causes, fire, structural failures, transport, icing). In incidents, there may not be the involvement of victims.

22

Fig. 4. Annual evolution of total accidents/incidents occurred related to wind power industry in absolute numbers (top) and parameterized by the installed capacity (bottom).

Source: Moura Carneiro, et al - 2013

Figure 4 presents the historical evolution of the total accidents, given in absolute numbers

(CWIF, undated). These absolute values are parameterized by the global installed onshore wind power generation capacity of the respective year (from 1995 to October 2011).

Until October 2011, there were a total of 1093 records of accidents and/or incidents related to the wind industry sector. The analysis of the available data suggests that the security level attained progresses concomitant to the wind industry advancement during each corresponding period. While in absolute numbers the accidents oscillate and exhibit a trend to grow, the parameterized data indicate a different direction, pointing to the decrease of accidents related to wind installed capacity.

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Fig. 5. Annual evolution of human fatalities occurred related to wind power industry in absolute numbers (top) and parameterized by the installed capacity (bottom).

Source: Moura Carneiro, et al - 2013

The absolute number of fatalities and its parameterized value by the installed wind power generation capacity of the respective year is illustrated in Figure 5 (CWIF, undated).

Compared to Figure 4, a similar trend can be observed: the declination of the number of victims of accidents in wind sites from 2000, after the tech boom. Nonetheless, in absolute numbers, casualties also present a cyclic oscillatory growth trend over the years.

From a qualitative perspective, the paper points out some of the documented cases of wind turbine related to fatalities. The most documented type of fatality involving direct partners such as workers of the wind industry or small turbine owners/operators is due to fall (11), being also reported electrocution, tower collapse, tower crushing, servicing, ice falling, mounting, explosion, and maintenance. Considering that some of them might be related to the installation phase, and the dismantling as well, it is worth mentioning how the decommissioning has not to be seen only under the financial aspect but also it has to aim toward the standardization of the procedures in order to reduce as much social risks as possible.

24

Besides, the standardization has to be followed by an optimization of the decommissioning operations. The decommissioning phase together with the recycling might play a pivotal role to reduce the CO

2

emissions (Wang, Y. & Sun, T., 2012). The main finding of Wang, Y. and

Sun, T. is that present-day wind power plants have a lifetime emission intensity of 5.0 - 8.2 g

CO2/kWh electricity, a range significantly lower than estimates in previous studies. The results show that the estimate suggests that wind is currently the most desirable renewable energy in terms of minimizing CO

2

emissions per kWh of produced electricity.

For this study, the limits of the system include the following four phases in the life cycle of the wind power plant: the production and transport of the components of the power plant, the operation of the wind plant which includes reconditioning and renewal of the components, and finally, the disposal (including recovery) of the material consumed over its lifetime.

Due to the expectation that much of the plant will be recycled, the disposal phase will recover about half of the amount of CO

2

emitted from the production phase. Although there may be some negative impact involved in the recycling process (such as the necessary transportation of materials), the disposal phase ultimately presents net positive effects, which is one advantage of wind energy in comparison to nuclear, a point that should not be underestimated. Without disposal, the environmental impact of wind power plants will increase by approximately 87.6% (Wang, Y. & Sun, T., 2012).

Some of the aforementioned concerns related to the wind farms decommissioning have found an answer in the USA, specifically in Oklahoma where measures were undertaken by

Oklahoma legislators to facilitate wind power growth (Ferrell, S.L. & DeVuyst, E. a., 2013).

In addition, a number of concerns that arise between developers and landowners, including assurance of wind turbine decommissioning at the end of their useful lives were analysed.

The legislators enlisted the authors to develop an economically-sound proposal to ensure developers complete their decommissioning obligations.

Because of a lack of operational experience (few U.S. projects have been decommissioned) an economic analysis of turbine decommissioning is complicated, leading to lack of data regarding decommissioning costs. This article provides background for the decommissioning issue, presenting the chronicle of the decommissioning development included the Oklahoma

25

Wind Energy Act as well as frame issues that remain for policymakers in regulating the wind power development.

It is interesting to analyse how this act can facilitate wind power development by tackling the decommissioning issue. This is essential considering the national goal of 80% nation’s electrical power come from clean sources by 2035 set by President Obama. Nevertheless, there are many challenges in the wind power development in addition to the decommissioning, for instance one of them is securing the land needed by wind turbines.

Usually, this often involves negotiations with dozens or hundreds of landowners for longterm land leases. Their main concern lies in what will happen to the wind energy systems when they have reached the end of their useful life. How will the landowner be assured that the wind energy developer will be willing or able to safely remove these systems and restore the property to its preconstruction condition? This is not only related to them but it involves cities, counties and states as well. If the developer will not, or cannot, decommission their project sites, landowners will look to a governmental body to do the job.

It is not only a matter of who will be supposed to decommission the wind farm, but also at what price. Indeed, ensuring that a project will be properly decommissioned is a particularly challenging problem. For the time being almost none of the utility scale wind power projects in the U.S. have been decommissioned, and those that have are the 1980s era projects that used turbines much smaller and configured much differently from the turbines that make up the majority of the existing U.S. fleet. As a result, little is known about the full costs of decommissioning. Furthermore, in the absence of a contractual or regulatory obligation to decommission a project, would a developer even undertake such a venture?

It is clear that without assurances that a project will be properly decommissioned, many landowners are reluctant to enter into such a long-term agreement. This has led to the exploration of a number of potential approaches to dealing with the decommissioning issue.

Oklahoma was particularly concerned with the dismantling issue. As a state with a centuryold oil and gas industry, it has been dealing with the problem of abandoned well sites for many years. Then legislators decided to find also a solution for wind power, by contacting the authors, Ferrell and DeVuyst, to undertake the drafting legislation to address a number of landowner concerns, including the decommissioning issue.

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The main objectives were the following:

1) Impose an affirmative duty on the turbine owner or operator (and not the landowner) to decommission any turbines at the end of their useful lifespan.

2) Assure landowners that any wind power project will be properly decommissioned, and that specific conditions must be met for the decommissioning to be considered complete.

3) Establish a funding mechanism that would allow the state to decommission a wind energy project if the owner or operator defaulted on that duty.

4) Tailor the funding mechanism to create an account that would enable the state to decommission a project with no additional state appropriations.

5) Keep the costs of funding the mechanism low to avoid discouraging developers from further activity in the state.

With these considerations in mind, Ferrell and DeVuyst began to work on draft legislation for introduction in the 2010 regular session of the Oklahoma legislature. Once ready, the provisions included in the draft were negotiated by a working group that was composed of the authors, a landowner group, a representative from the Oklahoma Corporation

Commission and representatives from several wind energy developers and utilities.

There were many objections related to the draft, especially by wind energy developers because they did not want to agree upon the payment of any kind of deposit or fee regarding the decommissioning for two main reasons. First, they noted that wind energy projects entail substantial initial capital costs, and that the fee structure would be imposing costs at the point of their projects’ development when their cash flows are most constrained. Second, they argued that the salvage value of the turbine equipment itself was sufficient to secure their decommissioning obligations and that the salvage value of the equipment at the end of the turbine’s life would likely exceed the costs of decommissioning, thus giving the developers a powerful economic incentive to fulfil their decommissioning obligations.

On the contrary, the groups did readily agree on the need for standards for decommissioning.

Both developers and landowners agreed that establishing a statutory duty for developers to decommission projects would put all developers on equal footing (as some developers had

27

not been including decommissioning language in their landowner contracts) and would alleviate at least part of the landowners’ fears.

The standards established for decommissioning are codified in the Oklahoma Statutes at Title

17, 160.14:

A. The owner of a wind energy facility shall be responsible, at its expense, for the proper decommissioning of the facility upon abandonment or the end of the useful life of the commercial wind energy equipment in the wind energy facility.

B. Proper decommissioning of a wind energy facility shall include:

1. Removal of wind turbines, towers, buildings, cabling, electrical components, foundations and any other associated facilities, to a depth of thirty (30) inches below grade; and

2. Disturbed earth being graded and reseeded or otherwise restored to substantially the same physical condition as existed prior to the construction of the wind energy facility by the owner, excluding roads, unless the landowner specifically requests in writing that the roads or other land surface areas be restored.

C. The decommissioning of the wind energy facility, or individual pieces of commercial wind energy equipment, shall be completed as follows:

1. By the owner of the wind energy facility within twelve (12) months after abandonment or the end of the useful life of the commercial wind energy equipment in the wind energy facility; and

2. If the owner of the wind energy facility fails to complete the decommissioning within the period prescribed in paragraph 1 of this subsection, the Corporation Commission shall take such measures as are necessary to complete the decommissioning.

D. A lease or other agreement between a landowner and an owner of a wind energy facility may contain provisions for decommissioning that are more restrictive than provided for in this section.

The final version of the decommissioning security provision, codified in the Oklahoma

Statutes at Title 17, y 160.15, follows:

A. After the fifteenth year of operation of a wind energy facility, the owner shall file with the

Corporation Commission evidence of financial security to cover the anticipated costs of

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decommissioning the wind energy facility. Evidence of financial security may be in the form of a surety bond, collateral bond, parent guaranty, or letter of credit.

B. The evidence of financial security shall be accompanied by an estimate of the total cost of decommissioning, minus the salvage value of the equipment, prepared by a professional engineer licensed in the State of Oklahoma. The amount of the evidence of financial security shall be either:

1. The estimate of the total cost of decommissioning minus the salvage value of the equipment which shall be filed with the Commission in the fifteenth year of the project and every tenth year thereafter for the life of the wind energy facility; or

2. One hundred twenty-five percent (125%) of the estimate of the total cost of decommissioning which shall be filed with the Commission in the fifteenth year of the project.

C. If the owner of a wind energy facility fails to file the information with the Commission as is required by this section, the owner shall be subject to an administrative penalty not to exceed One Thousand Five Hundred Dollars ($1,500.00) per day.

D. In the event of a transfer of ownership of a wind energy facility, the evidence of financial security posted by the transferor shall remain in place and shall not be released until such time as evidence of financial security meeting the requirements of this section is posted by the new owner of the wind energy facility and deemed acceptable by the Commission.

Nevertheless, there are still remaining issues and nobody knows what would happen if an

Oklahoma project (subject to the Act) suffered catastrophic damage early in its life cycle, for example before the project was required to post its decommissioning bond.

In 2010 the Scottish Natural Heritage (SNH) published guidance on Good Practice During

Wind Farm Construction (GPDWC). The GPDWC guidance aimed at: wind farm developers, construction companies and contractors working on wind farm sites; consultants and advisors supporting the wind farm industry; planning officers working on wind farm applications; statutory consultees such as SNH, Scottish Environment Protection Agency (SEPA) and others with an interest in wind farm construction and those responsible for the regulation of wind farms.

SNH intends to add to GPDWC with a chapter on Restoration and Decommissioning Plans

(RDPs) for onshore wind farms. SLR Consulting Ltd (SLR) was commissioned by SNH to undertake background research to further develop understanding of the environmental

29

impacts and considerations for restoration and decommissioning to support this new guidance.

The key research areas, according to Welstead, J. Et al 2013, were as follows:

1.

the potential impacts on the natural heritage of infrastructure being left in situ or removed;

2.

the criteria that determine when infrastructure will/should be removed, or otherwise;

3.

options and requirements for infrastructure removal techniques;

4.

options for reuse of any existing infrastructure with and without removal;

5.

case study examples of current restoration practices and decommissioning proposals.

The key areas of focus for the study were ecological impacts, hydrological impacts, landscape impacts and the engineering limitations that require being considered in the restoration and decommissioning of onshore wind farms. Broader issues such as health and safety, waste and land management issues were beyond the scope of this research.

It was recognised that wind farms have been constructed on a variety of sites each with its own unique characteristics in terms of soil types, habitats and land uses. The research and guidance aimed to make more explicit the issues to consider and the options for restoration and decommissioning rather than setting out a prescriptive approach for all onshore wind farm sites.

Therefore, they did not want to define the same strategy for every wind farm, on the contrary they investigated how to support the development of guidance that enables the user to reach a

Best Practicable Environmental Option (BPEO).

The research study started by reviewing a number of existing Restoration and

Decommissioning Plans (RDP) and decommissioning sections for wind farms (onshore and offshore) within Environmental Statements (ES).

In general, it was found that restoration and decommissioning is not being given adequate or consistent coverage in ESs; there is a need for more detailed description of preferred options

30

and the environmental impacts associated with these; and that quantification and source of restoration materials is insufficient.

Because of this, the research has investigated the current practice and drivers for RDPs, the restoration and decommissioning process, the potential impacts of restoration and decommissioning impacts on the natural heritage, and the options for end-of-life infrastructure.

Thanks to a thorough and deep investigation, Principles and Best Practice have been established. Indeed, BPEO provides a framework for a RDP, especially in considering the balance of environmental effects of removing or leaving infrastructure, method of removal and the process to underpin environmental decision making. The principles are the followings:

Restoration is the overarching principle with decommissioning an activity within this;

RDPs should provide the opportunity to lever improved restoration at decommissioning stage (especially if this was insufficient at construction stage) and leave the site in better condition than the original baseline;

To prove the ‘reversibility’ of wind farms where all visible traces and all significant environmental impacts are removed (including below ground infrastructure) if appropriate;

To devise pragmatic solutions based on the existence of the wind farm;

To gather evidence through the decommissioning process upon which to base future recommendations, such as standardisation of engineering design elements;

To be assessed in terms of carbon balance especially level of peat disturbance, soil movement, distance to recycling, on site vehicle movements);

To help decide whether to repower or decommission.

As regards the practice, the following template for the RDP, which can be adapted according to site-specific conditions, was developed.

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Fig. 6. Framework for Restoration and Decommissioning Plan.

Source: Welstead, J. Et al - 2013

The approach outlined in the Figure 6 will provide a systematic, transparent and flexible process for a RDP and importantly planning and reviewing the success of site restoration and aftercare. Experience from other industries suggests that sustained positive communication and practical working relations between developers, landowners and planning authorities/regulators will help minimise potential problems and achieve better long-term results. In turn this will also build confidence within regulating agencies and public in the ability of sites to be successfully restored to a good standard and in a timely fashion.

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3 METHODOLOGY AND DATA

In order to establish an overview of the era of wind turbine decommissioning, data were collected in several ways. First, available research papers and reports on the decommissioning cost assessment, removal methods and regulations were gathered and analyzed. Regarding the Italian regulations, several interviews to the staff of the energy department of the Basilicata Region were conducted in order to get information and references about the authorization procedure, while for Sweden, a report about Swedish decommissioning operations and procedures developed by the wind energy department in

Gotland was consulted (Aldén L. et al, 2014).

Subsequently, an overview of the Swedish and Italian methodologies regarding to how these costs have to be assessed as well as what developers are required to do regarding the decommissioning in the permit issuance were included.

Finally, detailed estimated dismantling cost data was obtained from Tèkne s.r.l., an Italian

Engineering Firm that deals with public works, renewable projects, telecommunications and other, for one of the wind parks in Italy they have assessed (Falco M., 2014). Mariagrazia

Falco is the design engineer in Tèkne s.r.l that allowed me to study the wind farm specifications about the dismantling operations and in the paper her name will be used to refer to the firm estimated data.

The Italian estimated cost data were compared with data collected in Sweden and several case studies, both based on estimated and real data, are presented.

The flow chart presented in the following page (Figure 7), summarizes the adopted methodology for this thesis.

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Fig. 7. Methodology Flow Chart.

In the next chapters the Italian and Swedish decommissioning regulations along with their benefits and limitations in the wind power project development will be examined closely.

Furthermore, the different methodologies used to assess the amount of the security bond needed for decommissioning operations will be revealed with regard to their consequences for both developers and environmental impacts. Then a discussion will be held on comparisons of case studies in Sweden and Italy. Finally, conclusions about regulations and methodologies regarding the dismantling cost assessment will be drawn. Recommendations will also be given to foster and to improve this study.

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4 APPLICATION OF THE METHODOLOGY AND RESULTS

In this chapter the methods used in Italy and Sweden to estimate the decommissioning cost as well as the regulations issued by authorities are presented. Furthermore, details about how to secure the money needed for the dismantling at the end of the wind farm life cycle are given.

Both in Italy and Sweden, authorities are generally strict in establishing the size of the bond that has to be guaranteed by the developers. The bond or deposit that can be assured in several ways like bank guarantee or insurance policy provides financial means to help ensure decommissioning obligations are carried out in the event the operator is unable to meet its future commitments or goes bankrupt.

The authorities, regions or delegated bodies in Italy and municipalities in Sweden, cannot risk endangering the environment or to have insufficient resources to perform the dismantling, in the unlikely event that operator is unable to do so.

Basically, the authorities are trying to ensure that wind farms will be dismantled and the place will be restored at the end of their lifetime.

4.1 Italian regulations on decommissioning

At the end of December 2003, the Legislative Decree n. 387 of 29/12/2003 implementing the

EU Directive 2001/77/EC (Italy Congress, 2003) was approved. It was entered into force on

15 February 2004 and it set (in 20 articles) a national reference framework for the promotion of renewable energy sources (RES). The Decree established a timetable for the periodic reporting, reviewing and monitoring of progress towards the implementation of the decommissioning process. Additionally, as declared in the article 12 entitled “rationalization

and simplification of authorization procedures”, the Decree empowered the twenty regions on the Italian territory to issue a unique authorization regarding the construction and management of renewable plants in compliance with the regulations relating to environmental safeguard as well as the protection of the landscape and the historical and artistic heritage. The guidelines for the aforementioned authorization are listed in the

Ministerial Decree n. 219 of 10/09/2010 “Guidelines for the authorization of plants powered

by renewable sources” (Italy Congress, 2010). In the third section of the Decree, it is specified which provisions have to be included in the authorization to build the wind park, in

35

order to face the future decommissioning. According to the paragraph j, at the beginning of the work, wind developers are expected to guarantee a deposit for the execution of operations related to the decommissioning of the wind farm including the restoration of the site to a substantially similar condition prior to the construction of the wind farm.

Developers have to proceed through bank guarantee or insurance policy according to the amount established generally by the regions or delegated bodies in proportion to the value of restoration works needed for the land and the environment. The decommissioning bond or security shall be paid in favour of the regional administration (or delegated body) that will be required to perform the decommissioning operations and environmental restoration of the site in place of the defaulting party. Moreover, such security shall be re-evaluated on the basis of the inflation target rate every 5 years.

In brief, the security bond has to be guaranteed in order to get the approval for the construction of the wind farm. The regional authority is strict with evaluating the amount of the deposit and how it has been assessed. Indeed, it has to be compiled thoroughly according to good practice and the use of common sense, without taking into account any possible recycling or scrap value of the wind turbine components that could be resold. This is due to the uncertainty related to the unpredictable market price of the metals that fluctuates unsteadily over the years, which means that at certain times the value of scrap metal might be very low or almost none. Furthermore, the decommissioning cost assessment has to be done according to the regional price list issued by the regions, as explained in details in the next paragraphs. These guidelines do not apply to offshore installations for which the authorization is issued by the Ministry of Infrastructure and Transport, along with the

Ministry of Economic Development and the Ministry of Environment and Protection of land and sea, in the manner referred to in Article 12, paragraph 4, of the Decree n. 387 of 2003

(Italy Congress, 2003) and prior grant of use of State maritime property by the maritime authority in charge.

4.2 Swedish regulations on decommissioning

All wind turbines that have a total height of over 50 meters, and two or more wind turbines standing together are considered an environmentally hazardous operation according to the

Environmental Code (Miljöbalken, 2013).

36

Depending on the number of wind turbines and their total height, the wind farms are subjected to different regulations. If the wind farm specification is such to belong to the orange area in Figure 8, then developers are required to apply for the permit according to the

Planning and Building Act as well as an environmental notification pursuant to the

Environmental Code. On the contrary, if they belong to the red area, the permit by the

Environmental Code is mandatory.

Permission for a wind farm in the red area is reviewed by the county boards through the environmental assessment delegations. Delegations can issue the permit only if the local authority (municipality) gives its consent for the issuance of licenses as well. Since the 2009 amendment of the permission process, a building permission is not required for these wind parks.

Regarding wind farms in the orange area, both the notification according to Environmental

Code and the building permit under the PBL are reviewed by the municipality. It is worth mentioning that developers, who intend to install wind farms that fall under these requirements, are also able to apply voluntarily for the Environmental Code permit even though they are not required to. This specific permit allows them to have set conditions for its whole duration instead of a planning and building permit where conditions might change.

37

Fig. 8. Wind farms’ classification with respect to license permits regulations.

Number of turbines in the X axis.

Source: Hagberg - 2011

For decisions about wind parks that need the permit according to the Environmental Code, financial security for costs incurred in dismantling and remediation measures is requested.

This type of security intents to protect society from future costs resulting from the decommissioning.

Generally speaking, the operator is always required to take care of the site after the dismantling operations are accomplished. This is regardless whether any financial security is available or not. If unable to find any responsible operator, the liability for decommissioning may burden firstly the landowners and secondarily the society.

The developer is required to make proposals on the amount of money needed for the restoration of the land in a credible way and is required to come up with the documentation presenting the overall decommissioning cost assessment according to good practice.

38

Afterwards, it is up to the authority to make an assessment whether the amount can be considered reasonable or not. The Authority may also request further information of the developer, if it is deemed necessary to compile the assessment.

For wind farms that require permits according to the Planning and Building Act (PBL) as well as an environmental notification, according to the legislation there is no obligation for developers to provide security. As regards the financial security, it is stated that: "A security shall be accepted if it is shown to be adequate for its purpose” (Miljöbalken, 2013).

The security bond can be gradually built up according to a plan that at any time satisfies the contingent need for a dismantling. The main purpose of security is to protect society from the risk of having to bear the cost of dismantling and should therefore be large enough to cover these costs.

According to the national law, the security has not to be administratively costly and shall not be greater than what is needed. The arrangement for the security must also allow that as much capital as possible will remain to the developer. Security must be available to the supervisory authority and be predictable and simple enough to be handled by them (Miljöbalken, 2013).

The following lines present a historical anecdote related to a court case that represents now a court precedent. Indeed, both developers and county boards often refer to the court case when motivating the amount of the security needed for the decommissioning. In late 2008, the firm

Vindkompaniet received the permission to erect 14 wind turbines, each with a maximum power of 3.6 MW for a total power output of 51 MW in Taka Aapua. The permission was appealed to the Environmental High Court regarding the type of the security bond, its amount and when it was supposed to be paid. The High Court stated that the decommissioning cost assessment cannot take into account possible incomes related to the scrap of metals, besides the court accepted the estimated dismantling cost to be 300.000 SEK per turbine (Taka

Aapua, MÖD Mål nr M 2210-08, 2008).

With reference to offshore wind turbines, they are approved either by the Land and

Environment Court (MMD) regarding turbine within the territorial limit or by the government for turbines intended to be installed in the economic zone (Miljöbalken, 2013).

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In sum, developers that desire to build wind farms in Sweden that require a permit according to the Environmental Code, have to assess the decommissioning cost prior to the installation without including any possible income of recycling and scrap of the wind turbine components.

In Sweden, the permit issuance sets the amount of money needed for the future decommissioning operations as well as when the money has to be available through the bond.

The amount of money related to the bond could be assured entirely when the permit is issued, spread out all over the wind farm lifetime or a combination of them. Moreover, the sum of the security bond in the permit must be adjusted according to the consumer price index in all cases, regardless of the payment schedule. Index date is normally the year the permit is granted.

4.3 Italian decommissioning cost assessment

In order to estimate the future dismantling cost, developers are required to follow the price lists issued and updated every year by the regions. In these price lists are included many different activities and works listed according to the following classification:

Rentals

Construction works

Structural restorations

Water and sanitary system

Heating and air conditioning

Electrical systems

Lifting systems

Road works

Green areas arrangements

Works realized with the use of inert materials coming from the demolitions

Aqueduct, sewage, miscellaneous equipment, water purification and pipelines

Agriculture, animal husbandry forestry works

Agronomic works

Works of soil conservation and water regulation

40

Geotechnical and Soil investigation

Archaeological works

Renovations, restoration and preservation works

Maritime works

Collection and disposal of waste systems and remediation of contaminated sites

Renewable energy and energy sources

Security costs

Referring to the suitable section for every working activities, in the price list is specified the cost of each operation by defining for example the cubic meters for an excavation, the km for the transportation, the kg of material for the landfill disposal and so on. In this way developers can assess the full decommissioning cost for their particular project. In case a specific type of work cannot be explicitly identified it must be included as an estimate made by the operator. This is generally valid for every public works as well. Once the decommissioning occurs, companies interested in performing the dismantling operations can participate in a lowest bid auction, i.e. the decommissioning project will be awarded to the company that makes the lowest bid.

4.4 Swedish decommissioning cost assessment

In Sweden the dismantling cost can be estimated in two different ways. The first one is really straightforward and it is based on the estimated cost experienced in previous approved wind farms’ permissions. In the permit, the companies are only required to specify the number of turbines and the total maximum height, omitting possible important cost factors. Therefore, this method could represent a limitation because wind farms might differ in many aspects such as the maximum power output, size of foundations, etc, although the number of turbines and the total height are still the same.

Often the developers in Sweden try to claim that the decommissioning cost per turbine of their wind farm would be the same of the aforementioned court precedent (300.000

SEK/turbine) because then the resulting bond amount would be low. On the other hand, although the authorities can require more information from the companies to assess whether there are differences between the wind farm and the court precedent, they are not obliged to do so by law.

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Even though for few wind parks the amount might be enough to cover the dismantling operations, there are still uncertainties regarding the possible consequences. Considering that this approach is the most used, future risks regarding the decommissioning operations exist.

The second method employed in Sweden to determine the dismantling cost is based on the thesis entitled “What goes up must come down - Modeling economic consequences for wind

turbine decommissioning” (Perez O., Rickardsson E., 2008) that has been performed as part of a larger study conducted by Consortis Producentansvar AB and Svensk Vindenergi. The study gives a thorough assessment of the wind farm decommissioning processes by collecting relevant costs directly from the contractors of each activity presented in the Figure 9.

Fig. 9. An overview of the decommissioning processes.

Source: Perez O., Rickardsson E - 2008

Furthermore, the thesis also includes the revenue coming from the reselling of the materials such as steel and stainless steel, cast iron, copper, aluminum and lead. This income has to be excluded in the decommissioning cost assessment as mentioned before.

4.5 Comparison between the Italian and the Swedish decommissioning cost

In section 4.5 both estimated and real decommissioning cost data collected from Italy and

Sweden are presented and scrutinized via case-studies analysis. The case studies regarding estimated data are four, one from an Italian Engineering Firm and three from Sweden. The two available real data refer to Sweden.

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4.5.1 Italian decommissioning cost

The estimated decommissioning cost provided by Tèkne s.r.l (Falco M., 2014) is related to a

10 MW Wind farm that should be located in the south of Italy. Unfortunately, it was not possible to know the exact site according to the confidentiality agreement. Nevertheless, the firm stated that five Vestas V100 2.0 MW wind turbines have been chosen for the wind park.

In the following Tables 4 to 8 the thorough costs breakdown of the whole wind farm in the decommissioning process for each component are presented: Wind Turbine and

Hardstandings areas (Table 4), Cables (Table 5), Substation (Table 6), Roads (Table 7) and

Transformer (Table 8).

Regarding the transportation of each component that could be delivered to a landfill site, waste treatment plant or recycling plant, depending on the material type, a maximum distance of 15 km between the wind farm and the disposal sites was stated.

The cost of each operation refers to the price list issued by the regions as mentioned before.

The only one exception is related to the operation No. 6 in Table 4 concerning the Wind

Turbine dismantling of each component, their transportation and the disassembly of internal components. The cost of this operation was established according to the wind turbine manufacturer. Indeed, considering the special equipment such as cranes needed during the installation as for the dismantling, the manufacturer will take care of this operation.

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Table 4. Expected cost for Wind Turbines and Hardstandings areas removal.

Source: Falco M. - 2014

Operation

1

2

3

4

5

6

7

8

9

10

11

Wind Turbines and Hardstandings areas Cost (€)

Excavation

Removal of steel needed for the stabilisation of the excavation

Demolition of Foundations

Transportation of the foundations material to landfill/waste treatment plant/recycling plant (15 km)

Landfill/Waste Treatment plant/Recycling plant disposal of foundations material

Wind Turbine dismantling of each component + transportation + disassembly of internal components

Landfill/waste treatment plant/recycling plant disposal of electrical components

Removal of hardstandings areas

(laydown/wating areas, crane pads)

Transportation of the hardstandings areas material

Landfill/Waste Treatment plant/Recycling plant disposal of hardstandings areas material

Backfilling of foundations and hardstandings areas

Total

Percentage of the overall decommissioning cost

€ 14.356,00

€ 15.470,40

€ 74.940,00

€ 47.700,00

€ 10.620,00

€ 100.000,00

€ 246.750,00

€ 21.071,88

€ 27.328,13

€ 7.837,50

€ 315.576,25

€ 881.650,16

40,39%

Table 5. Expected cost for Cables removal.

Source: Falco M. - 2014

Operation

12

13

14

15

16

17

18

19

Cables

Excavation

Landfill/Waste Treatment plant/Recycling plant disposal of cables

Transportation of the cables trenches material (soil + cables) (15 km)

Backfilling of cable trenches 1

Backfilling of cable trenches 2

Hot-mix for road restoration - layer 1

Hot-mix for road restoration - layer 2

Hot-mix for road restoration - layer 3

Total

Percentage of the overall decommissioning cost

Cost (€)

€ 135.168,77

€ 97.601,76

€ 108.984,96

€ 20.187,80

€ 89.074,08

€ 182.821,80

€ 158.766,30

€ 77.527,44

€ 870.132,91

39,87%

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Looking at Table 5, it is worth mentioning how the high cables removal cost is related to the reconstruction of a municipality road (operation 17, 18 and 19). Indeed, the most part of the cables (11,45 km out of 16,32 km) was installed under a municipality road that has to be reconstructed once dismantling occurred. According to the firm that already dealt with several wind parks, this is an exception because usually wind farms characterized by such long distances between the turbines and electrical grid are uncommon. The reconstruction of the municipality road accounts for the 48,16 % of the total cost summarized in the Table 5 for the removal of the cables.

Table 6. Expected cost for Substation removal.

Source: Falco M. - 2014

Operation

20

21

Substation

Substation removal + Transportation 15 km

Landfill/Waste Treatment plant/Recycling plant disposal of electrical components

Cost (€)

€ 127,20

€ 282,00

22

Landfill/Waste Treatment plant/Recycling plant disposal of concrete

€ 495,60

23 Backfilling of foundations € 849,60

Total

€ 1.754,40

Percentage of the overall decommissioning cost

0,08%

The substation is a small prefabricated building where cables coming from wind turbines are collected. Its removal represents the cheapest operation to carry out, corresponding to just

0,08 % of the overall decommissioning cost.

Table 7. Expected cost for Roads removal.

Source: Falco M. - 2014

Operation

24

25

26

Roads

Removal of service roads

Transportation of roads material (15 km)

Landfill/Waste Treatment plant/Recycling plant disposal of roads material

Total

Percentage of the overall decommissioning cost

Cost (€)

€ 67.100,51

€ 87.022,69

€ 24.957,45

€ 179.080,65

8,20%

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Table 8. Expected cost for Transformer removal.

Source: Falco M. - 2014

Operation

27

Transformer

Removal + Transportation + Landfill/Waste Treatment plant/Recycling plant disposal

Total

Percentage of the overall decommissioning cost

Cost (€)

€ 250.000,00

€ 250.000,00

11,45%

The pie chart in the Figure 10 shows the cost breakdown. Without taking into account the reduction in the cost due to the lowest auction bid, the overall cost for the whole wind farm is roughly 2.180.000 € (20.000.000 SEK), therefore 436.000 € per turbine (4.000.000 SEK).

Fig. 10. Cost breakdown of the Italian wind farm decommissioning.

Source: Falco M. – 2014

According to the company that provided the decommissioning cost data, usually at the end of the lowest bid auction the total amount of money needed to carry out the dismantling is reduced between 30 and 40 percent of the overall original estimated cost.

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4.5.2 Swedish decommissioning cost

According to the report about Swedish decommissioning operations and procedure developed by the Department of Wind Energy, Gotland University (Aldén L. et al, 2014), the decommissioning cost of five Swedish wind farms were analyzed. Whereas the dismantling cost of turbines with a maximum power output of 225 kW and 500 kW are based on actual data since they have been already dismantled, the others are estimated cases.

Table 9 gives an overview in terms of turbine model, location and restoration level of the

Swedish wind farms analyzed.

Table 9. Swedish wind farms decommissioning.

Source: Aldén L. et al - 2014

Model

Company and

Location

Number of

Turbines

Restoration Level

Vestas and

Windworld,

500 kW

Vestas V90

2.0 MW

Gotland,

Näsudden

Vattenfall,

Västerbotten, Åsele

35

40

Foundations, crane pads and roads are removed. Cables remain.

Crane pads, roads and cables remain. Foundations removed to ground level.

Vestas V27

225 kW

Falkenberg Energy,

Lövstaviken,

Falkenberg

2

Crane pads, roads, cables and foundations remain.

Unknown

2 MW

Gotland,

Näsudden at least

5

Foundations, crane pads and roads are removed. Cables remain.

Vestas V82

1.65 MW

Model

Example

10

Roads and Crane pads remain.

Status

(Year)

Disassembled

Actual case

(2013)

Estimated case by

Vattenfall

(2011)

Disassembled Actual case (2013)

Estimated case by

Wickman Wind

(2013)

Estimated case by

Pérez O. &

Rickardsson E.

(2008)

47

Table 10 illustrates the cost breakdown regarding the decommissioning of the estimated cases in Sweden. As for the wind farm located in Västerbotten, the cost breakdown was not available. It is certain is that crane pads, roads and cables being left in the site have a cost equal to zero, while the rest is not available (N.A).

The estimated case for the Vestas V82 1.65 MW wind turbine, was carried out to illustrate how well the model made by the authors (Perez O., Rickardsson E., 2008) estimates material contents. The authors took into account even the revenues coming from the selling of the scrap of the metals. For a fair comparison and according to the regulations, these revenues were not included in the Table 10. In order to calculate the cost for transporting the crane and other components, the default transport distance of 300 km was used. Additionally, the analysis was related to the turbine itself, without taking into account roads and crane pads.

Because of this, among the three estimated cases (Table 10) it is only possible to draw a general conclusion in terms of the overall cost, always bearing in mind the different restoration levels.

Referring to the cost per MW, the gap amount among them is quite significant considering that decommissioning operations of the estimated case regarding the 1.65 MW wind turbine

(898.000 SEK) would cost 60% more than the turbine in Gotland (562.000 SEK) and almost four times of the cost estimated in Västerbotten (232.000 SEK). Unlike the 2.0 MW wind turbines, the 1.65 MW one entails the removal of cables, that represents the biggest expense in its decommissioning. This affects significantly the high overall cost, even though the 1.65

MW does not include the removal of roads and crane pads.

The higher overall cost of the wind park in Gotland compared to the Västerbotten case, can be attributed to the more advanced restoration level envisaged as well as other factors such as the location and the crane cost.

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Table 10. Swedish wind farms estimated decommissioning cost.

Source: Aldén et al - 2014 & Perez O., Rickardsson E. – 2008

Sweden Sweden Sweden

Components

Crane

Labour

Transport

Removal of foundations

Removal of hardstandings areas

Removal of roads

Removal of cables

Restoration

Total Cost

Total cost per MW

Model example

1.65 MW

Estimated case

SEK

175.000

120.000

20.000

141.000

N.A

N.A

1.010.000

17.500

1.482.000

898.000

Gotland

2 MW

Estimated case

SEK

500.000

100.000

250.000

150.000

75.000

50.000

0

0

1.125.000

562.000

Västerbotten

2 MW

Estimated case

SEK

N.A

N.A

N.A

N.A

0

0

0

N.A

465.000

232.000

Table 11 illustrates the cost breakdown regarding the decommissioning of two real cases experienced in Sweden. For these actual cases the differences among the components in terms of cost can be pinpointed. While for the 225 kW wind turbine crane pads, roads, cables and foundations are left in situ, for the 500 kW turbine cables represent the only component left. Regardless the differences in the restoration level, according to these two cases, it seems that the cost increases more in proportion to the power output. The reason behind this lies in the much higher rental cost of the crane (+ 490%) and also for the labor (+ 535%).

According to these case studies, general conclusions cannot be drawn because of the scarce availability of data and the variability of different factors such as locations and restoration level.

49

Table 11. Swedish wind farms actual decommissioning cost.

Source: Aldén et al - 2014

Sweden

Falkenberg

0,225 MW

Actual case

Components

Crane

Labour

Transport

Removal of foundations

Removal of hardstandings areas

Removal of roads

Removal of cables

Restoration

Total Cost

Total cost per MW

SEK

16.855

11.288

12.500

0

0

0

0

0

41.643

181.000

Sweden

Gotland

0,5 MW

Actual case

SEK

82.600

60.400

45.000

38.400

14.400

28.800

0

0

269.600

539.000

50

5 DISCUSSION AND ANALYSIS

This Chapter 5 discusses the differences between Italy and Sweden and the consequences due to the regulations, the amount of money needed to secure the decommissioning operations and how the bond assessment affects developers.

5.1 Results from the decommissioning regulations

Without taking into account small wind turbine such as the ones for micro generation (up to

10 kW) in Italy the regulation is quite strict and according to the authority, developers are required to assure that decommissioning will be carried out through a bank guarantee or an insurance policy. This guarantee is simply a clause included in the permit issuance. If the bond is not guaranteed, the permit is not valid and the operator cannot start to build the wind farm. As a consequence of this, the deposit is assured in the earliest phase of the project development.

Because of the high amount of money that has to be secured at the beginning of the project, this kind of regulation could discourage small investors to the advantage of large companies or utilities. Additionally, the full security amount might be higher than it will be needed, because it does not take into account the reselling of any scrap of wind turbine components and especially the price reduction due to the lowest bid auction.

In Sweden the regulation is different and the conditions differ, for each wind farm, according to wind turbines’ number and height. More specifically, for wind farms with maximum six turbines and an overall maximum height of 150 m, there is no obligation for developers to provide any security, even though the operator is always required to take care of the decommissioning operations. In this case, the lack of the bond could endanger its accomplishment. Nonetheless, considering the lifetime of the wind farm, typically 15-25 years, it is quite hard to be certain that developers will carry out their duty. Nevertheless, for wind parks that need a permit according to the Environmental Code, at the beginning of the project, it is mandatory for developers to assure at least certain part of the bond. In the 28% of cases that already received the permission between the years 2009 and 2012, developers had to provide the whole security amount (Aldén et al, 2014).

51

At least compared to the Italian authorization procedure, in Sweden there is more flexibility considering that in Italy developers have to provide the whole amount of the security bond in proportion to the value of restoring works needed for the land and the environment in order to get the permit.

5.2 Results from the decommissioning cost assessment

Whereas between the Swedish and Italian regulations some similarity arose, the decommissioning cost assessment unveils totally different techniques.

In Italy, according to the guidelines issued by the Italian government, the regions or delegated bodies, verify whether the decommissioning cost assessment has been estimated thoroughly according to good practice and the use of common sense. Moreover, it has to be done according to the price lists issued by the regions, where each activity implies a cost, although in reality the disposal of some components might not. Also bearing in mind that developers are not allowed to include in the estimate any possible recycling or reselling of scraps, this type of approach leads to high costs. On the other hand, once the lowest auction bid is concluded the dismantling operations will be expected to receive a significant price reduction that could be between 30% and 40% (Falco M., 2014).

In Sweden the main decommissioning cost methodology consists in referring to the aforementioned court precedent. Indeed, generally the county administrative boards tend to approve the developers’ assessment based on the previous court precedent that might lead to low safety bonds. This is partly due to not analyzing thoroughly each wind farm technical specifications with regard to the court precedent. By taking into account only the total height and the number of turbines many other crucial factors that can lead to a different decommissioning cost, might be neglected. The 300.000 SEK set in the court precedent might not be enough to cover the decommissioning operations because of these uncertainties.

Considering this approach is the most used and that the bond seems low, future risks regarding the decommissioning might arise. Nowadays, the raising concern related to the amount of the bond and the turbines that do not need necessarily a security, led to a review of the regulations by the national authorities.

Finally, the second method based on the thesis that has been performed as part of a larger study conducted by Consortis Producentansvar AB and Svensk Vindenergi, is not so

52

widespread. Although the developed method seems quite accurate, the authors focused more on the wind turbine itself, without taking into account any removal of crane pads as well as roads. Furthermore, according to the regulations the revenue due to the reselling of the metals has to be excluded in the dismantling cost assessment.

5.3 Results from the decommissioning cost

The overall decommissioning cost of the wind farms already presented in this study along with the restoration level are summarized in Table 12. Nevertheless, dealing with so many different cases in terms of location, type of restoration level and data available, renders an allembracing comparison not so trustworthy. According to Table 12, the Italian wind farm is the only one to be completely dismantled. Conversely, the Swedish wind farms show different grades of restoration.

Thanks to the detailed information about the Italian decommissioning cost assessment, it is possible to pinpoint the cost differences between the Italian wind farm and the Swedish estimated cases by performing separated comparisons.

The first comparison can be done between the Italian wind park and the one in Gotland (2

MW wind turbine), bearing in mind that the removal of the cables accounted for almost the

40 % of the overall cost (as shown in Figure 10). Furthermore, the decommissioning cost in the Table 12 does not take into account the reduction in the price due to the lowest bid auction (30 - 40 %). A fair comparison can be achieved, subtracting both the cable cost and the price reduction due to the auction from the total. The resulting cost per MW would be between 720.000 and 840.000 SEK and in any case, the Italian dismantling cost results always higher (around + 25-50%) compared to the 2 MW wind turbine in Gotland (562.000

SEK).

53

Table 12. Wind farms decommissioning cost.

Restoration

Level

Foundations

Cables

Crane pads

Roads

Total Cost

Total cost per MW

Source: Aldén et al - 2014 & Perez O., Rickardsson E. – 2008

Sweden

Sweden Sweden Italy Sweden

Model

Gotland Västerbotten Unknown Falkenberg example

1.65 MW

Estimated case

898.000

2 MW

Estimated case

1.482.000 1.125.000

562.000

2 MW

Estimated case

2

465.000

232.000

2 MW

Estimated case

4.000.000

2.000.000

Sweden

Gotland

0,225 MW 0,5 MW

Actual Actual case case

41.643

181.000

269.600

539.000

Subsequently, the second comparison can be carried out between the 1.65 MW wind turbine and the Italian one. The comparison can be made assuming the same restoration level for the

Italian wind farm, namely deducting the crane pads removal cost (7,22 %), the removal cost of the roads (8,20 %) and the reduction of the price due the lowest bid auction (30-40%) from the overall cost per MW. The final cost would lie then between 1.000.000 and 1.184.000

SEK. Even in this case, the Italian cost would be higher (around +10-30 %) than the 1.65

MW wind turbine (898,000 SEK).

Finally, by applying the same method according to Västerbotten restoration level, the Italian wind turbine removal would cost between 400.000 SEK and 466.000 SEK, around +70-100% than the removal of the wind turbine in Västerbotten (232.000 SEK).

Focusing on the Swedish decommissioning cases, even though among them the cost per MW differs significantly, looking at both the cases in Gotland, the estimated case for the 2 MW wind turbine and the real case for the 0,5 MW one, the cost per MW is approximately the

2

foundations removed up to the ground level

54

same. Furthermore, the real case related to the wind turbine in Falkenberg (0,225 kW) is characterized by a restoration level almost similar to the one for the estimated case in

Västerbotten (2 MW). The only difference consists in the foundations removal to the ground level for the 2 MW wind turbine. This should not imply a huge increase in the overall decommissioning cost by comparing the cost per MW of the two wind turbines, as supported by the cost data. Indeed, the Falkenberg wind turbine decommissioning cost per MW is

181.000 SEK, while the Västerbotten turbine dismantling cost is a bit higher and equal to

232.000 SEK (+ 28%).

55

6 CONCLUSIONS

This paper aimed to start shedding light on the current status regarding the wind farms decommissioning practices, in Italy and Sweden, in terms of regulations, costs and procedures that developers are obliged to follow for the security bond assessment.

In order to do so the available research papers and reports on the decommissioning cost assessment, removal methods and regulations were thoroughly investigated. Moreover, detailed estimated dismantling cost data were obtained from a wind farm in Italy. The Italian cost data were compared with data collected in Sweden and along with them, the regulations and legislations related to how these costs have to be assessed as well as what developers are required to do regarding the decommissioning in the permit issuance were examined.

In Italy, regions or delegated bodies are empowered to decide whether to approve or not the wind farm construction. More specifically, one of the clauses in the permit issuance depends on the security needed for the decommissioning operations. Developers have to proceed either through a bank guarantee or an insurance policy and it has to be assured before the wind park installation. Considering that the level of the bond is generally high, this kind of approach tends to discourage small investors.

On the contrary, compared to the Italian bond, in Sweden the most common security amount of 300.000 SEK per turbine, which is definitely low compared to both the Italian cost and the method developed by Perez and Rickardsson, represents a level playing field for every investor. Additionally, the Swedish regulations are more flexible and only in the 28% of the cases, the entire amount of the bond has to be assured before the installation.

It is widely agreed that the Swedish regulations aim to favor the wind power development.

Nevertheless, the malleability with regard to wind farms that only need a notification according to the Environmental Code, therefore no security has to be provided, along with the low amount of the security bond, the decommissioning accomplishment might be endangered.

As for the decommissioning cost assessment, in the other words the amount of the bond, Italy and Sweden have few similarities. The only one in common, does not allow developers to

56

include possible revenues coming from the recycling of wind turbine components as well as the reselling of the scraps. Otherwise, Italian and Swedish methods to establish the dismantling are totally different.

In Italy the price lists issued by the regions have to be followed strictly by developers, leading to an overall high cost, although just before the decommissioning starts, the lowest auction bid is expected to reduce the price up to 40 %. In Sweden the main method is based on the estimated cost experienced in previous wind farms permit approval with special regards to the court precedent. This entails a low bond amount compared to Italian estimations and the method suggested by Perez and Rickardsson, advantaging investors but at the same time it might put at risk the fulfilment of dismantling operations.

Finally, several comparisons with cost data collected by an Italian firm and by investigating reports on the Swedish decommissioning procedures were made. The main limitation while comparing the wind turbine dismantling costs is the miscellaneous background of each wind farm that does not allow a mere analysis with respect to the cost per MW. During the study, many differences arose such as the type of the restoration level, the distance from the grid, from the recycling or disposal plant, etc. Because of this only preliminary conclusions can be drawn.

The Italian wind farm has been compared with the other estimated cases in Sweden taking into account the same restoration level, and it has been shown how in any case it is the most expensive. Even though, according to the Italian firm that shared the cost data, this wind farm implied a huge expense in the reconstruction of the municipality road, the high cost is doubtless due to the regulation.

Nevertheless, even among the Swedish cases, the estimated dismantling costs per MW vary considerably. While comparing the estimated and real cases in Gotland, although wind turbines are quite different (0.5 MW and 2.0 MW), the total resulting cost per MW results almost the same.

In conclusion, the Italian methodology used in the decommissioning cost assessment is very accurate and thorough thanks to the use of the price lists issued by the regions where any kind of working activity, along with its cost, is included. Additionally, the price lists are also

57

easily available. Even though this approach unveils a meticulous attention to the details, however the resulting decommissioning cost is definitely high discouraging small investors in pursuing project of a significant magnitude. This is due to the high overall cost of each activity. If the price list were based on a more realistic market price, the resulting decommissioning cost, therefore the amount of the bond would be reasonable and more accessible even for small project developers.

On the other hand, in Sweden the most widespread methodology based on the court precedent is not so trustworthy and the low security bond might mislead on the possible real decommissioning cost. This is caused by differences between the court precedent and the wind farm under approval as well as the amount of security bond for the court precedent.

Nevertheless, the low amount of the bond represents a level playing field among project developers. Likely, looking at the pros and cons in Sweden and Italy, a middle way would envisage an optimal scenario both for developer and authority.

Because of the lack of enough available data and the different backgrounds of the few wind turbine analyzed, a comprehensive conclusion would be forced. In spite of that, interesting outcomes based on the comparison of the regulations and costs have been highlighted.

Furthermore, the current study can help to foster further investigation in this field by collecting as many cases as possible to achieve a more comprehensive result.

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