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Babcock & Brown to Buy Bluewater Wind

Proposed location (hatched red) for the Delaware Offshore Wind Park. The red dots represent locations for which Bluewater developed visualizations of the wind farm. Click to enlarge.

Babcock & Brown is buying Bluewater Wind, the developer of a proposed 150-turbine, 450MW wind farm to be located 11 miles off the coast of Delaware.

The acquisition by Babcock & Brown addresses the last major hurdle in the effort to finance and build Delaware Offshore Wind Park—potentially the first major offshore wind park in the US—which is how the $1.6 billion project would be funded.

All of the Bluewater Wind staff, including President Peter Mandelstam, will continue with the company.

Bluewater’s new partnership with Babcock & Brown provides us with the commitment, strength, reliability and financial backing to successfully develop the Delaware Offshore Wind Park, helping to ensure it will provide stable-priced, affordable, and clean, renewable power to Delmarva Power’s customers for many years to come. The Bluewater team is delighted to join the Babcock & Brown family of companies. I am honored that Babcock & Brown, a true leader in wind energy, valued our business model so highly that it offered to acquire the company.

—Peter Mandelstam
The V90-3.0 MW turbine. Click to enlarge.

Bluewater is partnering with Vestas for the wind turbines. The 3 MW Vestas V90 turbine has a rotor diameter of 90m, with a tower hub height of between 80 to 105m.

Babcock & Brown Babcock & Brown is a global investment firm that manages assets in excess of $50 billion. The company already manages in excess of 1,200 megawatts (MW) with its equity share in excess of 850 MW. This includes operations at 18 wind farms in eight US states.



Rafael Seidl

Placing wind parks far offshore all but eliminates the NIMBY factor. It also permits the use of very large diameter turbines (blade length ~60m) that are much more efficient and cheaper per MW capacity. There's quite a few of them off the Danish coast by now.

One major issue with wind power is that it's not always available when you need it. Sometimes it is when electricity demand is low. This means you have to back up wind turbines with a nearly identical amount of conventional power plant capacity, drastically increasing cost. One very interesting idea is to let windmills produce electricity directly only when there is immediate demand for it.

Otherwise, the power is used to compress air, which is then stored until needed. Old salt mines or natural gas fields are useful storage systems. Adiabatic compression does of course heat up a gas and, some of that heat is inevitably lost in storage. For high efficiency, you want to minimize the time the gas spends there. Subsequent re-expansion can easily lead to condensation of the water vapor contained in the compressed air, potentially damaging the blades of the expansion turbine.

One way around this is to use the relatively cool compressed air to cool the vanes of appropriately designed steam turbines from the inside out, creating protective shrouds much like those in a jet engine turbine. The overall thermodynamic efficiency of steam-powered cycles - used in the bulk of all electricity production worldwide - is currently limited by the high-temperature characteristics of available turbine vane materials. The resulting electricity of such a combined approach would no longer be renewable per se, but total CO2 emissions reductions might well be higher. And that is what ultimately matters.

I don't know if this particular offshore park will feature compressed air energy storage (CAES), probably not. However, IMHO, it is a technology worth keeping an eye on.


I would like to see a wind farm combined with a wave generator: put a floating platform ring around the wind turbine mast and hook up some hydraulic pistons and a generator, that would increase power production and reduce intermittency of production. And the NIMBY will complain now matter how far out the wind farm is, even if it's a tiny speck on the horizon they will b***h!


"One major issue with wind power is that it's not always available when you need it. Sometimes it is when electricity demand is low. This means you have to back up wind turbines with a nearly identical amount of conventional power plant capacity, drastically increasing cost."

Point you make is typical of the naysayers, but when windmills ARE producing, it means there is less need for a coal fired plant near by to fill the grid. Nearly identical conventional backup would only be necessary when the wind component in the electrical grid gets above 10 - 20%.

By placing the windmills off-shore there is less variability in the wind.


Rather than engineering a storage mechanism for wind, how about investing more in the transmission infrastructure. Since the wind is usually blowing somewhere, a lack of wind in DE could be compensated for by wind in PA and NY. Or, if necessary, grab some fossil- or nuclear-generated power from some other locale.

Further, if efficiency is improved at the points of consumption, winds farms would be built to replace rather than supplement existing capacity. In that case, the "shadow" capacity necessary when wind is not available already exists.

At the moment Vestas has suspended all sales of off-shore turbines because their gearboxes in these off-shore versions are breaking down faster than expected. The problem is that the wind blow on average 50% more off-shore than on-shore. This is good because it means about 50% higher production from off-shore turbines but the other side of the medal is much higher wear down. Currently Vestas is in the process of redesigning its offshore gearboxes and when that is done and they have tested the new design they will start selling their off-shore turbines again. This 450 MW park could very well be among the first off-shore parks to get these redesigned V90 turbines. Currently it is only Siemens that accept large orders for off-shore wind turbines.

For years to come off-shore wind power is not going to be big for the simple reason that the capital cost per MW is twice that of on-shore turbines. Plus maintenance expenses are also much higher for off-shore than for on-shore. Really it is a waste of money to do it off-shore. In the future do it on-shore in very large parks 500MW to 1000MW in the middle of an agricultural or a forests area. If there are any neighbors make a settlement paying them to accept the nuisance for these wind mills or pay them enough so that they can move and still be happy. If they still refuse we should have a law that allow for expropriation of rights to refuse a good compensation. There is serious nuisance mostly in terms of low-frequency noise and because the up to 600 foot high turbines need warning lights so that airplanes do not fly into them at night.

In Denmark we do 20% of the average annual electricity with wind turbines and that has been done without mayor adjustment of the grid. Plans to raise it to 50% will however necessitate major changes in the grid because the 20% average imply that wind power a few days a year do 110% of the electricity consumption with 10% then being exported.

I like this air concept Rafael. I hope for them they can make it economical. If it holds water they will however be copied and they will face stiff competition from the much larger companies in the industry.


Forgot my identity

juha k


As Jim already said, dedicated back-up for wind is not needed before penetration of wind power is so large that it gets big in the system and starts to replace conventional capacity as well as energy (which it does right from the beginning).

What is big? It depends on the system and best measure for it in this regard is to check capacity credit curve for wind power in particular system. This varies a lot from system to system and depends on wind characteristics in relation to consumption patterns. Jim's 10-20% gives some indication, but it truly is an s-curve starting from high capacity credit at low level of penetration and going lower once penetration gets higher.

Even in high penetrations one doesn't need very much conventional capacity compared to wind capacity and the cost does not come close to capital cost of wind. In fact it's about one tenth of it. Wind produces on average around 25% of it's capacity. If one wants to be sure that wind with backup is producing at least this much whenever it might be needed, then one needs backup capacity that's equal to 25% of wind's capacity. At this point wind with backup is giving equal contribution to the power system in terms of energy and capacity just like any other conventional source.

Cheapest way to do this is use gas turbines, which cost around one third of the price of wind capacity (they are certainly lot more expensive to operate, but this would not amount to much, since they won't be needed that much - they are there mainly for the capacity).

This is worst case scenario, which gives no capacity credit to wind. It usually it has this even when the penetration gets very high (half of all electricity or more).

It's gas turbines that these pressure storages have to compete with (unless there's plenty of reservoir hydro power) and it's a stiff competition in economic terms. I'm not convinced that pressure storages will come wide spread although I like the idea a lot.


Do you know how does that compressed air system holds against pumped storage hydroelectricity?


Sorry, forgot my ID

Rafael Seidl

@ Jim, Scott -

I think we're at cross purposes here. Germany for example has wind farms all over the country, so indeed you typically have the situation that some fraction of them are active at any given time. Even so, wind power is only possible at all in that country because of massive cross-subsidies from conventionally produced electricity. The gird operators must respond very quickly to local changes in wind strength all over the country and frequently re-jig the grid to make the most of the installed wind capacity. This means conventional power stations usually run at reduced load to avoid overloading local sections of the grid when wind power kicks in - or else the wind farm remains idle even when it could produce power because the load on the conventional plants cannot be varied all the time.

Buffering the wind power means you can always extract some useful power from this renewable source, regardless of instantaneous demand in the area and the current grid configuration. Conversely, grid and plant operators can plan/choose when to produce electricity from wind rather than a conventional source.

@ MH -

I just read about this myself, I have no numbers. However, a fair amount of the energy expended by an adiabatic compressor goes into heating the gas. The more of that is lost to the walls of the storage vessel/void, the less efficient the buffering process becomes. An old salt mine should work well in this regard, it features high volume per unit of exposed surface area. Spent natural gas reservoirs are much larger, but made up of porous rock so the surface are is quite large. Efficiency then becomes mostly an issue of heat transfer into and heat conduction inside the rock.

Pumping water uphill doesn't heat it up significantly because it's very nearly incompressible. Ergo, I would expect this to be more efficient, IFF the wind turbines pump water directly rather than producing electricity to drive electric pumps at the reservoir. Unfortunately, the best locations for wind farms rarely co-incide with those for hydro dams. Indeed, they can easily be hundreds of miles removed from one another. Bridging the distance with water pipes is infeasible economically and would anyhow also be inefficient. I suppose you could build a large artificial reservoir for an offshore wind farm near the beach, but the cost would be staggering and the NIMBYs would be out in force.

One combination approach would be to store the energy hydraulically but in high-pressure accumulators located in the base of the wind turbine tower - currently, just a big block of concrete. The concept would be similar to that of a hydraulic hybrid vehicle, but storage capacity would have to be significantly higher.

Conclusion: both pneumatic and hydraulic storage of wind energy are inherently quite lossy. However, that may still be preferable to the status quo, which requires an excess of conventional generating capacity.

juha k


I don't like to disagree with you, since I mostly like your comments a lot. However, I have to do it again. First, wind power production in Germany does not change fast. Weather fronts go slowly over Germany and aggregated production from many small wind plants changes quite smoothly in the time range that's important for power system operation. Big fast changes come from big individual power plants, transmission lines going offline or big consumers starting their equipment.

I'll admit that wind power production can change too fast to start coal plants from cold condition, but fortunately these situations are predicted quite well before hand and they can be warmed up in good time. So, only in rare occasions at current level of penetration conventional power plants in Germany run idle because of wind. Usually it is because it's not worthwhile to drive them down all the way for a short period of high winds and/or low consumption.

This situation does not differ much from what it was before the wind power was there. Consumption has always varied a lot and it should still be clearly the biggest contributor to variation in German system. In short, wind increases start/stop cycles of conventional power plants, but only to limited extent. Of course, more so when penetration increases.

TSOs like to keep noise about wind in order to make sure that they get compensated as much as possible, especially if they are private players. Danish public TSO is much more accommodating towards wind than Germans. Furthermore, private power producers don't necessarily like wind, since wind will decrease prices at power market to their detriment.

A point in water pumping. Wind power generators are very efficient and so are electric water pumps. I don't think there's big difference, if any at all, between using electricity or mechanical power to pump the water. I could be wrong though, since mechanical wind power plant might be cheaper to make.

Naturally you are correct to point out that pumped hydro is limited to areas where there's reasonable elevation difference and accessible water storages. I think one can safely say, that when there's a good site for pumped hydro, then it's clearly cheaper and also more efficient than compressed air storage. However, economics vary considerably depending on the local conditions for both of them.


Thank you Rafael,

Meanwhile I've been doing some reading about water pumped storage. It seems that it is a very common feature in some grids since 1890, as an example in the EU we have about 32GW! of Pumped Storage out of 188GW of hydroelectric capacity. With 0.75 efficiency it seems to be the cheapest way to flatten the loads in the system. Usually it's used in the context of dams, the utilization of wind turbines to augment the efficiency it is a very recent proposal, so there isn’t yet to much data about this issue.


The problem of intermittent wind could be alleviated by getting the generators up off the ground and into the jet stream.

juha k

Cheapest ways to increase flexibility of the power system are
- use existing reservoir hydro power
- use existing conventional power plants
- change market rules (better intraday market)
- industrial demand side measures and build gas turbines

After that there are plenty of choices with varying degree of profitability, possibilities include:
- other new capacity
- new transmission lines
- other demand side measures (electric vehicles, some loads in service sector and households, electric heating, heat pumps, heat storages, intelligent building design)
- electricity storages (pumped hydro, CAES--compressed air energy storage, batteries)
- other energy storages (hydrogen, other synthetic fuels)
- chp plants combined with electric boilers

Roger Pham

Back up fossil-fueled electrical generation is more efficient than stored energy, due to the energy loss in the conversion process to and from the energy storage reservoir.
Unless the wind is steady, the gas turbine will wear out fast if it has to be frequently throttled up and down in response to gusty wind, when high percentage of wind electricity penetration will eventually take place.
Diesel or NG fueled piston-engine generators in the MW range can respond quicker to changing wind speed without being harmed, and piston engines are much cheaper to acquire than gas turbine and has higher thermal efficiency and much better part-load efficiency. Higher maintenance cost for piston engine in comparison to gas turbine, but at lower duty cycle, will require less maintenance. Furthermore, distributed generation by NG fueled piston engine generator in larger buildings can supply heat and power at the same time, making them very efficient, at 80-90% overall efficiency.

Much into the future when fossil fuel will be phased out, there will be a need to turn excess solar and wind electricity into synthetic fuels for transportation and home heating in the winter.



Thank you for that link about the paper from Stanford University about wind turbines designed to harvest energy from high altitude jet streams.
At first I did not believe it. I through it was meant as a joke. But then again the paper is on Stanford’s website and it has been published in a peer reviewed journal: "Harnessing High Altitude Wind Power" IEEE Transactions on Energy Conversion Vol 22 No.1 March 2007.

I did a little extra search on the topic and I found a really good article in The Economist about this technology and similar technologies. For anybody interested start with the article in The Economist and then go on to the Stanford paper.

I am very skeptical that it would be possible to build a durable enough machine to go into the jet streams and stay there for months without maintenance. The article in The Economist describes another and much simpler project supported by Shell. This project I believe has enormous potential on a much shorter horizon. I quote the text from the Economist.

“Meanwhile, Wubbo Ockels of the Delft University of Technology in the Netherlands has been developing another approach to airborne wind generation at lower altitude, with backing from Royal Dutch Shell, an oil giant, and Nederlandse Gasunie, a natural-gas company. Dr Ockels's idea is to launch a kite (without rotor blades) from a ground station, turning a generator as it rises to an altitude of several hundred meters. When it reaches its maximum altitude the kite alters its shape to catch less wind, and can thus be reeled back in using much less energy than it produced when it was being paid out.”

Rafael Seidl

@ Neil -

high altitude wind farms are certainly an intriguing idea, but the technological and economic challenges are daunting. Promises of 1-2 cents per kWh are for the moment, just that. Also, safety concerns would probably keep any such devices from being used over inhabited areas or anywhere near commercial air corridors.


@ Rafael,

Steam cycles are not particularly limited by steam turbine technology, although new (existing) materials may have to be used.

Rather, it is the superheaters in the boilers that are setting the limit. The superheaters are subject to higher temperatures than the turbines (and moderately higher pressure due to pressure loss between superheater and turbine, both in pipes and valves).

A superheater steel needs to be able to withstand something like 50°C more than steam temperature, partly for heat transfer through tube material and steam boundary layer, partly because of uneven temperature distribution in the boiler.

Conventional gas turbine steels are quite sufficient to raise the inlet temperature in the steam turbine, although expensive because of the very high mass of steam turbines. (they are so heavy that they can take days to slow down after steam flow is shut off - actually, the steam flow is never turned off completely, because the turbine needs cooling).


This is not directed toward anyone, but just a general statment. Until we can harness only one electrical generation capability...if we ever could, what is wrong with many types of generation methods to achieve our needs? Build the grids to accept electricity from any source and use it as needed. There would be nothing wrong with an existing power plant contributing to the energy pool of different sources. It's like different gasolines doing the same job...powering an engine. (horrible analogy..I appologize.)
What about nanotech?? Any new radical changes there yet to incorporate into peaceful energy? It could be such a wonderful thing. If only the militery would stay away from it. ( Hey..I can dream can't I? )



CAES systems feed the stored air into the combustion chamber of a turbine where it is mixed with fuel and burned, so there's no issue with moisture. The two CAES operating today (Alabama, USA and Huntorf, Germany) are not associated with wind turbines. They simply compress air at off-peak night rates and generate during the day to capture the price spread. A planed installation in Iowa ( will use both off-peak and excess power from local area wind turbines for compression energy.

Juha K is right that wind turbine output aggregated over large areas changes slowly, and is quite predictable (unlike fossil plants which can drop offline with little notice). But he's wrong about only backing up 25% of nameplate power. If you do that you'll often have to dump excess electricity when output exceeds 25%. That represents a big chunk of total annual output; dumping it kills your economics.

Wind & solar can grow to 15-20% of supply before intermittency becomes a serious issue. Such penetration will take many years, long enough to develop a combination of storage, backup and demand management to handle intermittency.

juha k


It's true that sometimes you might need to dump electricity if wind penetration is high. But this happens only once the penetration is truly high and even then in moderate quantities. Regional wind power mostly produces in the range of 10-50% of it's capacity. Take a look at slide 14 from a presentation by Danish TSO and you can see that even when the penetration is 50%, the amount of wasted wind is small. And this is in the small system of Western Denmark with no transmission lines considered.

Denmark, which already has 23% energy penetration, does not need storage to handle variability of wind, although the markets make them use Nordic hydro power since it's the cheapest option for peaking and balancing. The amount of backup is also minimal at that level. The idea that 15-20% is some kind of limit for wind penetration comes from the fact that wind integration studies have been mostly limited to these penetrations. Nothing drastic happens once those percentages are broken. Slightly higher integration costs certainly, but they still remain relatively small. Power systems we have are quite capable of integrating wind and wind will also be contributing to the system, since it has a good chance of providing power when it's needed most. Just like any other form of power.

grace nyambura

i wish you guys you could write price list of 2.5MW,3.4 MW and 5MW turbines and the expense that are used to finish the whole project. i have been search since the last three weeks.

if you do that i will be glad and thankful

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