Wind energy in the Australian outback

Steinbeis Student evaluates the economic viability of wind energy

Powercorp is a medium sized Australian company specializing in isolated hybrid power supply systems. Apart from supplying power station components and the corresponding automation and control systems, Powercorp makes the intelligent stabilizing solutions to go with them. Eckhard Schultze who is studying for his Masters of Business Engineering degree at the Steinbeis University Berlin Career Center, went to work with the Powercorp Group as part of a business project in the Australian city of Darwin (Northern Territory). His brief: to analyze the economic viability and technical performance of wind energy solutions.

A Powercorp client had just entered the planning phase of a new wind/diesel power station to be set up in a small settlement north of Perth, Western Australia. The power station should include new wind energy generators able to survive cyclones – a recurring threat in the area. Neither the client nor Powercorp had any experience with such generators as neither had ever installed one.

To make sure the isolated power system met reliability requirements, the wind energy units had to be supplemented with a stabilizing solution. To do this, Powercorp offered the client two options although neither knew how well the solutions would perform, nor whether they would be profitable.

For his project, Eckhard Schultze evaluated both possible solutions. This meant examining the technical performance of each solution and economic viability then comparing. To make it easier for Powercorp to win new projects and acquire customers, his analysis also looked at client purchasing processes. This entailed looking at the buying process for his existing project – taking in all people involved on the customer side and within Powercorp – and, based on this work out a general marketing strategy for Powercorp.

To compare both power station options in terms of economic viability and technical performance, technical simulations were needed. These identified the parameters for factors such as fuel consumption for both power station options, or the number of operating hours for the diesel generators. The data generated by the technical simulations were then fed into a specially developed model based on standard investment cost accounting procedures. The model developed by Eckhard Schultze showed which power station would be the most economical over an investment period of 20 years. In his study, Schultze tabled a number of hypotheses on the options open to Powercorp to improve its marketing strategy. His analysis of the purchasing process was based on the underlying principles of buying centers, buying processes and buying categories. It uncovered a number of weaknesses within the existing Powercorp set-up, especially in the selling and communication process.

The insights provided by Eckhard Schultze’s project were used to work up a general marketing strategy for Powercorp which will now form the basis of any other new projects in the pipeline. The simulation models created during the project and the freshly defined approach will also flow into new projects where they will help the company compare the economic viability and technical performance of power stations. Now Powercorp is in an ideal position to assess profitability and the technical performance of wind/diesel power stations. Not only will this help the company acquire new customers, it will also form part of the internal power station development process.

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