As Europe’s early adopters of wind energy accelerate the decommissioning of ageing and less economically viable turbines, opportunities to redevelop the sites with new, bigger and more effective turbines are emerging. Though less straightforward and not necessarily cheaper than developing greenfield opportunities, these brownfield projects come with a few key benefits for infrastructure investors.
First and foremost, old wind farms are usually positioned with good wind resources and a grid connection, though this may be on the small side. There are access roads and, in all likelihood, a functioning substation; the latter reduces construction risk.
With EU legalisation in place to support repowering, such projects are of interest to GPs keen to keep investing in established geographies with minimal fuss. And there are clear benefits to the energy transition from transforming old sites: on average, repowering a wind farm will triple its output while reducing the number of turbines by a quarter. The output will increase more than the capacity as modern turbines are more efficient.
They are also significantly bigger – measuring up to 260m in height, modern turbines are generally more than twice as tall as pre-2010 turbines, impacting views, noise and ambience. This provides repowering another advantage over greenfield sites.
“Generally, once renewables have been in place for some time and are embedded in the local community, that community is relatively positive to the technology, so the planning journey and planning risk is easier to go through for a repowering,” says Baiju Devani, UK investment director at Bluefield Partners.
The brownfield benefits do come with a few caveats. One is that very little from the old project can be used in the new project and the coveted grid connection will often need an upgrade, which is never ideal.
“We have wind farms with three or five operators in it; to get all these operators to want the same thing and to repower at the same time is comparably difficult”
Thilo Busse
BayWa RE
Also, there is usually a functioning wind farm on the site already, meaning that repowering can be considered as two investments: one in the operating asset, which comes part and parcel with the site being acquired; and one in the new project, says Benjamin Kennedy, managing director of renewables at Ardian, that is engaged in repowering through their Italian ICQ platform.
“Often, there isn’t a clear synergy. You are creating a new project… which I think is interesting because some investors considering repowering wouldn’t necessarily invest in greenfield development.”
It is not uncommon for the operating asset to generate power right up until the new development happens, and this would provide some flexibility in when the change would be optimal from a cashflow perspective, Kennedy explains. “Up until the day that you start to construct the new wind farm, you would have the old wind farm operating… You can even keep the old one running while the new one is being constructed and squeeze a little more value out of it”.
Or, simply wait.
Michael Ebner, managing director of sustainable infrastructure at KGAL Investment Management, adds: “We have plans in the early planning stage to repower existing plants within our portfolio of up to €500 million, which would translate to 250-300MW. But for some sites, it makes sense just to run the turbines for another five or 10 years and then think about another solution.”
Repowering at scale
It will, however, not make societal sense to wait for too long before repowering suitable sites. In Germany, Spain and Denmark, in particular, the landscape is dotted with old turbines and 11GW of Germany’s onshore wind capacity consists of turbines older than 20 years. Turbines with a joint 20GW of capacity are older than 15 years.
Therefore, the scale of the repowering opportunity is considerable and growing. Between 2024 and 2030, about 27GW of European capacity is expected to be decommissioned, while 16GW will be repowered and ultimately transformed into 28GW of capacity, according to WindEurope, a trade association based in Brussels.
The apparent incongruence in the numbers is caused by the delay between the decommissioning and the commissioning of the repowered increased-capacity sites.
The rate of repowered projects coming online is expected to increase from 1.5GW in 2023 to 5GW in 2030, again according to WindEurope. The rate of capacity being decommissioned will look quite similar as some farms will be decommissioned and not replaced.
When considering the repowering opportunity, the obvious starting point is to consider the age of the market and to focus on countries and areas where assets may be both older and slightly subscale in terms of utilising the grid connection and modern technology.
Subsidies are a key consideration, too.
“We are currently repowering a portfolio of 10-15-year-old single turbines in Northern Ireland,” says Devani. The assets are under the Northern Irish renewables obligation certificates regime, where as long as the protocol is followed, a repowered development is maintained under the ROC regime. “By repowering, you in effect create a new asset which can then last for 30-35 years and go beyond the existing subsidy regime.”
The Teutonic opportunity
Early mover and onshore wind power supremo Germany is expected to have repowered 14.7GW of capacity by 2030, and last year commissioned 1.1GW of repowered capacity out of a European 1.5GW total.
As elsewhere, the trade-off between keeping the old and introducing the new is keenly observed before developers bring in the bulldozers in Germany. Legally, existing owners have been given the upper hand as new developers are not allowed to develop wind farms in some of the country’s old zones. On a project level, persuading diverse groups of owners to align along a new plan ensures a degree of inertia too.
“We have many small operators with only two or three turbines, and we have wind farms with three or five operators in it,” says Thilo Busse, head of cooperations and business development at BayWa RE Wind, which is 49 percent owned by Energy Infrastructure Partners. “To get all these operators to want the same thing and to repower at the same time is comparably difficult.”
Busse has a clear idea of what an ideal project looks like. “The perfect project has an age of 20 to 25 years, so the feed-in tariff has run out and it depends on the electricity market, and there we can look if it is economical to keep operating,” he says. “It helps if the company owns the project already and doesn’t have to engage with a group of operators.”
Once a repowering project is completed, BayWa RE keeps some projects on its balance sheet as an independent power producer and sells on other projects. The company is keen to co-operate with institutional investors.
“Many wind farms erected between 2008 and 2014 were owned by infrastructure firms or insurance companies,” says Busse. “These institutional investors don’t have the knowledge or the capacity to make a repowering.” He expects repowering projects to comprise 20-25 percent of BayWa RE’s onshore wind pipeline in Germany in the future.
Asked why the company has chosen to invest in developing repowering capabilities, the answer is not only that this is a way to get new projects in a densely populated country, but also that it helps to future-proof the business.
“Greenfield projects are in part even easier and cheaper than a repowering project. But we have learned a lot about the repowering market in the last five years that will be very helpful for the cost development in the coming five to 10 years,” says Busse.
Permits don’t come easy
The EU has recognised the potential of repowering projects and there are dedicated measures to support such developments in the Renewable Energy Directive that was revised in 2023. In this, EU member states are asked to ensure that all permitting procedures for repowering projects are completed within one year. For general renewable projects, the permitted timeline is two years.
For the so-called Renewable Acceleration Areas – areas where renewables projects can be deployed without having a significant environmental impact, which member states have to designate by 21 February 2026 – the preference for repowered projects is even more pronounced, with a deadline of one year for new projects and six months for repowered projects.
On the ground, however, things look a little less rosy. “We need three to five years for the permission of the new turbines. So, in the end, the permission of the repowering project is no different to a greenfield project made from scratch,” says Busse.
Hopefully, the new rules will have an impact, but even with the best of wills and a significant increase in the subsidy on offer, it has proven impossible for Germany to find takers for all of the 10GW of onshore wind capacity auctioned off under the subsidy scheme each year.
Generally, though, repowering is riding on a wave of goodwill, and this extends to the world of insurance, explains Tom Harries, partner at UK-based energy and infrastructure insurance broker NARDAC.
“If you’re going down the repowering route, you’re effectively buying a construction insurance policy for the duration of that repowering, whether it’s a full repowering and you’re ripping the whole thing down, or whether you’re cutting the head off and putting a new nacelle on top. It’s effectively a mini-construction policy, which in and of itself isn’t complicated,” he says.
Where it gets interesting is that the insurance might be slightly cheaper for a repowering than an original construction. “If that developer has an existing strong track record with the insurance, the insurers might provide a pretty good deal,” Harries says, quoting a 10-20 percent reduction compared with a greenfield project, though “it could be a bit more than that”.
Another thing that reduces the cost of insurance for a repowering project compared with greenfield is that the substation side, which includes the transformer(s), may not need replacing. Installing and transporting transformers is a risk-heavy part of the project insurance-wise, so “removing that single point of failure in a repowering project is very beneficial to insure”, Harries says.
Also, insurers prefer young assets over old ones, which encourages repowering. “If you bought a project 10 years ago, designed to last for 25 years, your lenders expect you to get full limit coverage for different types of natural catastrophe risks. Then 10 years down the line, you’re told you won’t even get half of that for the money you used to pay,” Harries says. “That starts to move the needle in terms of profitability.”
Profitability will be the economic driver for the repowering of Europe while the politics is driven by the need to ensure the best possible use of the available space and wind resources. The result will be the dismantling of mostly functioning older wind turbines with the discarded remnants of yesteryear’s pioneering renewable generators ending up in landfills.
But so be it. Caught between a rock and a hard place, the overriding concern must be to decarbonise. And if profits and politics can find the sweet spot, there is a lot of repowering waiting to be done.