Taking the risk out of investing in wind power

November 21, 2019

 

Rewind three years. It’s 2016 and in Novogrudok, a small town in Western Belarus, the country’s first fully functional wind farm is coming to life.

From now on, six turbines provide the town with up to nine megawatts of electricity by converting wind’s kinetic energy into electrical.

The wind farm powers about 7,000 households; that’s almost half of the town. Novogrudok’s neighbours start calling the city “capital of wind power”.

Fast-forward to 2019 and in Belarus’s Northern region, Vitebsk, seven new wind power plants with a total capacity of 25 megawatts are being planned.

The new wind farms will supply sustainable energy to over 20,000 households and are expected to reduce carbon emissions by up to 25,000 tonnes per year.

How did we get here?

The short answer is through years of hard work. It’s clear that we need to transform our global energy systems and move from fossil fuel-based energy to renewable energy, such as wind power. What’s not so clear is how to get there.

While everyone from government regulators to environmentalists to businesses agree we need to build more wind farms, globally we’re only seeing few large-scale wind farms in operation. Why?

Building wind farms is not easy. In fact, it’s a complex undertaking that takes time and money. Land leases must be secured, rigorous environmental reviews passed, and construction permits granted. And even then, lots of more authorizations are required to bring one online.

For investors, every single one of these steps is a risk that could mean the end of the project.

Taking the risk out of wind power

Boosting investments in wind energy therefore means reducing the risk for investors and removing some of the barriers that typically present themselves during the development process of a wind farm.

In the case of Belarus, UNDP helped to guarantee land lease agreements, obtained construction and environmental permits, secured grid connection approvals, undertook a two-year wind speed analysis, and carried out a detailed feasibility study.

It was a long, sometimes strenuous process, but it was worth it. All of this made wind farms in Belarus more feasible and attractive for investors.

As a result, starting in 2020 a Turkish renewable energy company plans to invest approximately US$40 million in wind farms. Once built, it will be the largest in the country.

What’s next?

Now that the first wind site is up and running, we’re working to de-risk and auction four more by the end of 2020.

If we achieve our vision hundreds of thousands of households in Belarus will be powered by wind. We’re setting a precedent for other countries that will hopefully lead to an increase in wind power development across the region.

 

The project “Removing Barriers to Wind Energy Investment in the Republic of Belarus” is financed by the Global Environment Facility and implemented in partnership with the Ministry of Natural Resources and Environment Protection of the Republic of Belarus.