Turbine owners receive payment from the energy consumer, whichever utility company buys their generated power.
Depending on the PPA that both parties have agreed upon, the average payment is between $3,000 and $8,000 for each wind turbine.
For the more powerful turbines that exceed 2Mw, the payments increase to $10,000+.
An Owner with just five wind turbines, could mean an annual salary between $15,000 and $40,000.
It is common for wind turbine purchase and installation costs to be recouped within the first 5-15 years of operation. With a life expectancy of 25 years, there is a possibility of at least 10 years of profit, besides repair and maintenance costs.
Wind farmers need to factor these costs into their expenditure, along with the removal and disposal of the wind turbine at the end of its useful life.
Large commercial wind turbines have rated capacities of 1 – 2.5 megawatts.
Payments from utility companies to farmers are per Megawatt. Therefore, a 2Mw turbine that earns $3250 per Megawatt, entitles the farmer to a $6,500 annual payment, per turbine.
Some wind farms consist of a handful of turbines, whilst others have 150. The largest wind farm is in Northern California and currently houses almost 5000 turbines.
Average Yearly Revenue
Turbine owners receive payment from the energy consumer, whichever utility company buys their generated power.
Depending on the PPA that both parties have agreed upon, the average payment is between $3,000 and $8,000 for each wind turbine.
For the more powerful turbines that exceed 2Mw, the payments increase to $10,000+.
An Owner with just five wind turbines, could mean an annual salary between $15,000 and $40,000.
It is common for wind turbine purchase and installation costs to be recouped within the first 5-15 years of operation. With a life expectancy of 25 years, there is a possibility of at least 10 years of profit, besides repair and maintenance costs.
Wind farmers need to factor these costs into their expenditure, along with the removal and disposal of the wind turbine at the end of its useful life.
Leasing Land for Wind Turbines
Another popular way to make a profit from wind energy is by leasing land to utility companies for them to erect turbines.
The landowner has no initial outlay, doesn’t have to foot the bill for maintenance and repair costs, and can subsidize their current income.
This appeals to farmers of both arable and livestock, as not only do they have available land, but also, their farming isn’t affected.
Payments begin as soon as the initial contracts are signed. The first of which is a fom of retainer where the utility company pays for the lease of the developmental rights of the land for 3-5 years. This provides sufficient time for the construction of the wind turbine.
Payments are calculated per acre.
The landowner (generator) and the utility company (consumer) sign a contract called a Power Purchase Agreement, PPA.
This lays out the system of ongoing, index-linked payments.
- Payments are based on the RATED CAPACITY of the turbines, with a set amount being paid annually depending on the generation capabilities of the wind turbine.
- One flat annual payment per turbine. A mutually agreed payment that rises each year in line with inflation. The amount is irrespective of the amount of electricity generated. This is a good solution in areas where wind flow is more unpredictable and expectations don’t meet projections.
- Some contracts offer the landowner a set percentage of the value of all generated electrical power. This is particularly attractive in regions with consistently high wind speeds and large commercial turbines with high megawatt output.
PPA contracts ensure that farmers get paid a fair amount and receive a steady income stream for the length of the contract.
Most are between 20 and 25 years long, so for landowners with several wind turbines on their property, it could prove to be a relatively lucrative affair.
Maintenance Costs
Maintenance and repair costs also need to be factored in to initial expenditure. Most turbines require twice-yearly maintenance, with increasing frequency the older the turbine becomes.
Average maintenance costs are approximately 2% of the cost price, bi-annually. Repairs can mount up too; A replacement rotor might cost 20% of the initial wind turbine price.
