Research On Wind Power Project Investment Decision-making Based On Real Options Theory

In recent years,countries all around the world have been increasing R&D budgets to cope with the energy crisis and alleviate environmental pollution.As renewable energy,the wind power has the promising future because of its mature technology.However,given the high investment costs and high risks of wind power project,some investors are still hesitated to invest.So it is of great importance to study the investment decision making of wind power project.In this paper,the option values brought by the uncertainties of wind power projects are considered.Based on this,the model of real option value is built.By calculating this model,the critical conditions for investing is determined,which can help investors choose the proper time to invest.Numerical simulations are finished by MATLAB,conclusions are shown as follows:With the increase of electricity price,the option value increases;with the increase of wind turbine price,the option value decreases.The investment threshold of wind power project increases with the increasing volatility of electricity price and the decreasing drift rate of electricity price,which means the government should order the electricity price market,reduce the unnecessary fluctuations of electricity prices and increase the rate of return of electricity price.By this,the investors are more willing to invest in wind power projects.In addition,moderated subsidy of electricity can also stiffen the investors' initiative and promote the development of wind power industry.