Time Span does Matter for Offshore Wind Plant Allocation with Modern Portfolio Theory

Lana V. L. Costa-Silva, Vinicio S. Almeida, Felipe M. Pimenta and Giovanna T. Segantini
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Lana V. L. Costa-Silva: Federal University of Rio Grande do Norte, Brazil,
Vinicio S. Almeida: Federal University of Rio Grande do Norte, Graduate School of Management, UFRN-PPGA, Salgado Filho Av., 3000, Lagoa Nova, Natal-RN, 59078-900, Brazil,
Felipe M. Pimenta: Federal University of Santa Catarina, Brazil,
Giovanna T. Segantini: Federal University of Rio Grande do Norte, Brazil.

International Journal of Energy Economics and Policy, 2017, vol. 7, issue 3, 188-193

Abstract: Allocating wind farms across different locations may reduce the problematic intermittency of wind. The objective of this research was to analyze the optimal allocation of offshore wind farms in the U.S. East Coast through modern portfolio theory. The research was conducted with 25.934 secondary observations of offshore wind energy produced by 11 hypothetical offshore wind farms. We calculated six minimum variance portfolios, each referring to a distinct time period. Four rebalancing strategies were settled in order to assess the performance of the portfolios we estimated. The results indicate that MPT can be used to calculate the diversification of offshore wind farms locations, which may reduce the individual variability of hourly wind power changes.

Keywords: Modern Portfolio Theory; Optimal Allocation; Offshore Wind Power (search for similar items in EconPapers)
JEL-codes: C53 C61 L94 Q42 Q47 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eco:journ2:2017-03-22

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