Dr. Deniz Ozkan successfully defended her doctoral dissertation in mid-2010. The title of Deniz’ research project was “Financial Analysis and Cost
Optimization of Offshore Wind Energy Under Uncertainly and in Deregulated Power Markets.” Serving on her Examining Committee were academic advisor Dr. Michael Duffey (EMSE ), Dr. Charles Garris (MAE),Dr. Kevin Rackstraw, Principal with Rackstraw Consulting LLC, an internationally recognized wind energy consulting firm), Dr. Enrique Campos-Nanez (EMSE) and Dr. Jonathan Deason (EMSE).
Deniz’ research addressed the phenomenon that, after twenty years of rapidly expanding worldwide capacity and technical advances in wind energy, proponents claim that offshore wind technology is commercially competitive, especially at high wind resource sites. Her research results, however, showed that the profitability of offshore projects depends on many uncertain parameters, some of them highly site specific. This uncertainty comes partly from natural variations such as wind speed, and unknown costs of different physical system elements and their interactions.
Unfortunately, Deniz found that such physical cost uncertainties are coupled with many other project-level financial factors that are not well characterized in publicly available financial assessment methodologies. Most proejcy financial analytical methods use fixed design assumptions that ignore optimization for site-specific conditions. They also ignore the impacts of complex financing alternatives, lengthy project schedules, site specific emission avoidance and its monetization, and actual revenues and penalty costs in the context of site specific deregulated power networks and competitive bidding.
After reviewing the evolution of cost and engineering design models for offshore wind, Deniz developed and tested a prototype software tool entitled OFWIC – Offshore Wind Integrated Cost Model. The new model is a comprehensive analytical tool that analyzes the cost of energy under uncertainty. It enables multidisciplinary design optimization, including nested optimization algorithms to discover the most economically viable system design.
Deniz’ dissertation explained in detail the methodology used in OFWIC and its application in a case study for the site of the first proposed offshore wind project in the U.S. Significant variations in “cost of energy” estimates were found, depending on which factors are included in the model.
