Evaluation on external economies of renewable energy resource utilization: Taken wind power engineering project as example

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1 Scence Journal of Energy Engneerng 2015; 3(41: 15 Publshed onlne December 26, 2014 ( do: /j.sjee.s Evaluaton on external economes of renewable energy resource utlzaton: Taken wnd power engneerng project as example Yanln Qu 1,, Ylan Su 2 1 Busness College of Honghe Unversty, Mengz County, Yunnan Provnce, , Chna 2 College of Lfe Scence and Technology, Honghe Unversty, Mengz County, Yunnan Provnce, , Chna Emal address: yanlnqu@gmal.com (Yanln Qu To cte ths artcle: Yanln Qu, Ylan Su. Evaluaton on External Economes of Renewable Energy Resource Utlzaton: Taken Wnd Power Engneerng Project as Example. Scence Journal of Energy Engneerng. Specal Issue: Soft Computng Technques for Energy Engneerng. Vol. 3, No. 41, 2015, pp. 15. do: /j.sjee.s Abstract: Dfferent wnd power projects have dfferent external economcs level, the practcal evaluaton on whch can provde reference for wnd power projects selecton and qualfy the role of completed projects. In ths paper, the external economes of wnd power engneerng projects were evaluated by employng VIKOR method. The basc theory of VIKOR method was frstly ntroduced, and then the emprcal evaluaton was performed. After the evaluaton ndex system was bult from envronmental, socal and economc aspects, the external economes of three selected wnd power engneerng projects n Hebe provnce were studed. The evaluaton result shows the external economes of wnd power project #3 are the best one. The applcaton of VIKOR method n external economes evaluaton of wnd power project s effectve and feasble. Keywords: Wnd Power Engneerng Project, External Economes Evaluaton, VIKOR Method 1. Introducton Renewable resources are a part of Earth's natural envronment and the largest components of ts ecosphere, whch s an organc natural resource that can replensh n due tme compared to the usage, ether through bologcal reproducton or other naturally recurrng processes [1]. Renewable energy resources are a knd of energy resources, whch have the characterstcs of cyclc regeneraton and sustanable utlzaton. Renewable energy resources nclude wnd energy, solar energy, bomass energy, and so on. Wth the development of human socety, the mportant role of energy n people's daly lves s becomng ncreasngly promnent. Nowadays, the energy supply shortage and envronmental polluton ssues make explotng and utlzng renewable energy as the focus of worldwde concerns [2, 3]. Energy solutons for the future wll ncreasngly depend on the use of renewable energy resources. In the past many years, Chna s wnd power has developed rapdly, the cumulatve nstalled capacty of whch has ncreased from 0.3 GW n 2000 to 77 GW n In 2010, Chna surpassed the Unted States and ranked the frst n terms of cumulatve nstalled capacty of wnd power [4]. As a knd of renewable energy, wnd energy has the advantages of huge reserves, wdely dstrbuton, renewable and pollutonfree [5]. External economes are benefts that are created when an actvty s conducted by a company or other type of entty, wth those benefts enjoyed by others who are not connected wth that entty [3]. The entty that s actually managng the actvty does not receve the external economes, although the creaton of these benefts for outsders usually has no negatve mpact on that entty [6]. The benefts produced by wnd power, such as envronmental emsson reducton and economc growth, can enjoys by outsders, such as the resdents, naton, and ecology. Therefore, wnd power has external economcs. Currently, the study on external economes manly focuses on the ndustry and trade. Ref. [7] estmated the ndexes nternal returns to scale and external economes for twodgt manufacturng ndustres n West Germany, France, the U.K., and Belgum countres; Ref. [8] revewed the nternatonal trade lterature on ntrandustral and nterndustral producton externaltes; Ref. [9] proposed a twocountry model of monopolstc competton n whch dfferentated

2 2 Yanln Qu and Ylan Su: Evaluaton on External Economes of Renewable Energy Resource Utlzaton: Taken Wnd Power Engneerng Project as Example products are produced subject to external economes of scale and two countres dffer only n sze measured by the factor endowment; Ref. [10] studed the mpact on productvty growth of technologcal externaltes, both nter and ntrandustry, natonal or nternatonal, at the ndustry level for the EU countres and the perod Ths paper focuses on the external economes of wnd power project, and employs the VIKOR method to evaluate the external economes of wnd power project. The VIKOR method s a multcrtera decson makng (MCDM method, whch was orgnally developed by Serafm Oprcovc [11]. As a MCDM method, VIKOR has been appled n many ssues, such as suppler selecton [12], water resources plannng [13], servce qualty of arports [14], and so on. Ths paper comprses the followng: Secton 2 ntroduces the basc theory regardng VIKOR method; takng three wnd power engneerng projects n Hube provnce as example, the external economes evaluaton of wnd power engneerng projects based on VIKOR model s performed n Secton 3; Secton 4 concludes ths paper. 2. Basc Theory of VIKOR Method VIKOR method s a MCDM method to solve decson problems wth conflctng and noncommensurable crtera, assumng that compromse s acceptable for conflct resoluton, the decson maker wants a soluton that s the closest to the deal, and the alternatves are evaluated accordng to all establshed crtera. VIKOR ranks alternatves and determnes the soluton named compromse that s the closest to the deal [15]. Suppose the set of m feasble alternatves be X = { X1, X 2,, X m }, the set of n crteron functons be O = { O1, O2,, O n }. The nput data are the elements a j of the performance matrx { } A = a j, where m n j value of the jth crteron functon for the alternatve The basc step of VIKOR method s as follows Determne the Crteron Weght a s the X. The crteron weght determnaton s very mportant, whch has great mpact on the evaluaton result. There are many crteron weght determnaton methods, such as expert consultaton method, AHP method, entropy weght method, and so on Normalze the Performance Matrx A a to = j Normalze the ntal performance matrx { } the standardzed decson matrx R = { r j } m accordng to n Eq. (1. m n j mn ( aj ( aj mn ( aj ( aj aj ( aj mn ( aj a, I1, j N max rj = max, I2, j N max where I 1 and I 2 represent the subscrpt set of benefttype crteron and costtype crteron, respectvely; N = 1,2,, n. { } 2.3. Determne the Postve and Negatve Ideal Soluton The postve deal soluton s { 1, 2,, n} max { j, 1,2,, } (1 r = r r r = r j = n (2 The negatve deal soluton s { 1, 2,, n} mn { j, 1,2,, } r = r r r = r j = n ( Calculate the Group Utlty Value and Indvdual Regret Value The group utlty value can be calculated accordng to Eq. (4, and the ndvdual regret value can be calculated accordng to Eq. (5. r r S = w (4 r r j j j j j j r j rj R = max wj, j N rj rj 2.5. Calculate the Comprehensve Rankng Index The comprehensve rankng ndex can be calculated accordng to Eq. (6. where S S Q = v + S S R R R R ( 1 v = mn (5 (6 S S (7 S S (8 = max R R (9 = mn R R (10 = max v s ntroduced as a weght for the strategy of maxmum group utlty, v [ 0,1] ; 1v s the weght of the ndvdual regret. In VIKOR method, the value of v s usually set as 0.5, whch ndcates the decson makng s performed based on

3 Scence Journal of Energy Engneerng 2015; 3(41: 15 3 the balanced compromsng way. Therefore, the decson makng can be made accordng to the value of Q. The alternatve wth the mnmum Q value s the best one. The calculaton process of VIKOR method for evaluaton s shown n Fg.1. Start Analyze the research ssue, and buld the evaluaton ndex system Determne the crteron weght Normalze the performance matrx Determne the postve and negatve deal soluton Calculate the group utlty value and ndvdual regret value Calculate the comprehensve rankng ndex, and rank Perform the fnal evaluaton End Fgure 1. The calculaton process of VIKOR method. 3. Emprcal Evaluaton The wnd resource s abundant n Hebe provnce. In 2013, the cumulatve ongrd nstalled capacty of wnd power amounted to 7.75 GW n Hebe provnce, whch ranks the second n Chna. In the past few years, there are several approved wnd power engneerng projects, such as GUOHUA KUYUANBAYUAN wnd farm. Therefore, three wnd power engneerng projects n Hebe provnce were selected n ths paper. Frstly, the evaluaton ndex system of external economes of wnd power engneerng project was bult, and then an evaluaton on the external economes of wnd power engneerng projects was carred out by employng VIKOR model Buld the Evaluaton Index System When buldng the evaluaton ndex system, two methods are adopted, namely Questonnare and Lterature revew. After revewng the relatve lteratures, the Questonnare was desgned. Questonnares about the external economes of wnd power engneerng project were dspatched to experts and engneers n the feld of wnd power. The external economes evaluaton ndex system was obtaned by analyzng the results of questonnares, the result of whch s shown n Fg.2. The external economes of wnd power engneerng project are dvded nto envronmental beneft, socal beneft, and economc beneft. All of the ndces are the greatesttype ndex Evaluaton Process (1 Determne the crteron weght In ths paper, the expert consultaton method was employed to determne the crteron weght. 50 crteron weght scorng tables are dstrbuted to unversty professors, enterprse expertse and engneers. Accordng to the statstc results, the crterons weghts of external economes of wnd power engneerng project are determned, whch are lsted n Table 1. (2 Normalze the performance matrx The external economes crterons scorng of three wnd power wnd power engneerng projects are lsted n Table 2. A a : = j So, we can obtaned the performance matrx { } 6.7% 23.3% 11% 7% 3.8% 2% 43% 34% A = 8.9% 19.8% 10.5% 6% 4.4% 1.3% 46% 52% 7.7% 20.9% 14% 5% 4.3% 1.7% 47% 46% Accordng to Eq. (1, the standardzed decson matrx R = { r j } m can be obtaned: n R = (3 Determne the postve and negatve deal soluton Accordng to Eq. (2, the postve deal soluton can be r = 1,1,1,1,1,1,1,1, and the negatve obtaned, whch s { } deal soluton s = { 0,0,0,0,0,0,0,0} r. m n

4 4 Yanln Qu and Ylan Su: Evaluaton on External Economes of Renewable Energy Resource Utlzaton: Taken Wnd Power Engneerng Project as Example Fgure 2. External economes evaluaton ndex system of wnd power engneerng project. Table 1. Weghts of external economes evaluaton crterons Crteron C1 C2 C3 C4 C5 C6 C7 C8 Weght Table 2. Crteron values of three wnd power projects Crteron Scorng C1 C2 C3 C4 C5 C6 C7 C8 Wnd power project #1 6.7% 23.3% 11% 7% 3.8% 2% 43% 34% Wnd power project #2 8.9% 19.8% % 4.4% 1.3% 46% 52% Wnd power project #3 7.7% 20.9% 14% 5% 4.3% 1.7% 47% 46% (4 Calculate the group utlty value and ndvdual regret value Accordng to Eq. (4, the group utlty value of three wnd power projects can be calculated, whch are S = ; S = ; S = Accordng to Eq. (5, the ndvdual regret values of three wnd power projects can be calculated, whch are R = 0.21; R = 0.17; R = 0.14 (5 Calculate the comprehensve rankng ndex Accordng to Eq. (6, set v=0.5, the comprehensve rankng ndex of three wnd power projects can be calculated, whch are Therefore, Q = 1; Q = 0.437; Q = 0 Q < Q < Q Q Q Q Accordng to the calculaton result, we can safely draw the concluson that the external economes of wnd power project #3 are the best one.

5 Scence Journal of Energy Engneerng 2015; 3(41: Conclusons As a knd of renewable energy resource utlzaton, wnd power engneerng projects have developed rapdly n Chna n the past years. Dfferent wnd power projects have dfferent external economcs level, the practcal evaluaton on whch can provde reference for wnd power projects selecton. In ths paper, the external economes of three wnd power engneerng projects are evaluated based on the VIKOR method. After the evaluaton ndex system was bult, the weghts frstly were determned, and then the evaluaton was performed. The calculaton result shows the external economes of wnd power project #3 are the best one, whch ndcates the constructon of wnd power project #3 plays greater role n the promoton of envronmental, socal and economc development. Acknowledgements The author thanks edtor and revewers for ther comments and suggestons. References [1] [2] Tükenmez M, Demrel E. Renewable energy polcy n Turkey wth the new legal regulatons [J]. Renewable Energy, 2012, 39(1: 19. [3] L H, Guo S. External economes evaluaton of wnd power engneerng project based on analytc herarchy process and matterelement extenson model [J]. Mathematcal Problems n Engneerng, 2013, [4] Zhang S, AndrewsSpeed P, Zhao X. Poltcal and nsttutonal analyss of the successes and falures of Chna s wnd power polcy [J]. Energy Polcy, 2013, 56: [5] Chngulptak S, Wongwses S. Crtcal revew of the current status of wnd energy n Thaland [J]. Renewable and Sustanable Energy Revews, 2014, 31: [6] J. Markusen. Mcrofoundaton of external economes [J]. Canadan Journal of Economcs, 1990, 23(1: [7] Caballero R J, Lyons R K. Internal versus external economes n European ndustry[j]. European Economc Revew, 1990, 34(4: [8] Cho J Y, Yu E S H. External economes n the nternatonal trade theory: a survey[j]. Revew of Internatonal Economcs, 2002, 10(4: [9] Suga N. A monopolstccompetton model of nternatonal trade wth external economes of scale[j]. The North Amercan Journal of Economcs and Fnance, 2007, 18(1: [10] Claver N D, Castejón C F, Graca F S. External economes as a mechansm of agglomeraton n EU manufacturng[j]. Appled Economcs, 2012, 44(34: [11] Oprcovc S, Tzeng G H. Extended VIKOR method n comparson wth outrankng methods [J]. European Journal of Operatonal Research, 2007, 178(2: [12] Sanaye A, Fard Mousav S, Yazdankhah A. Group decson makng process for suppler selecton wth VIKOR under fuzzy envronment[j]. Expert Systems wth Applcatons, 2010, 37(1: [13] Oprcovc S. Fuzzy VIKOR wth an applcaton to water resources plannng[j]. Expert Systems wth Applcatons, 2011, 38(10: [14] Kuo M S, Lang G S. Combnng VIKOR wth GRA technques to evaluate servce qualty of arports under fuzzy envronment[j]. Expert Systems wth Applcatons, 2011, 38(3: [15]