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Scrapping a Wind Turbine: Policy Changes, Scrapping Incentives and Why Wind Turbines in Good Locations Get Scrapped First

The most common reason for scrapping a wind turbine in Denmark is to make room for a newer turbine. The decision to scrap a wind turbine is then highly dependent on an opportunity cost that comes from the interaction of scarce land resources, technological change and changes in subsidy policy. Using a Cox regression model I show that turbines that are located in areas with better wind resources are at a higher risk of being scrapped. Policies put in place in order to encourage the scrapping of older, poorly placed turbines actually have a larger effect on well-placed turbines. Keywords: Wind power scrapping, Nordic electricity market, Cox regression model

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DOI: 10.5547/01956574.35.2.8

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Published in Volume 35, Number 2 of The Quarterly Journal of the IAEE's Energy Economics Education Foundation.