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Wind energy harnessing is a new energy production alternative in Iceland. Current installed wind power in Iceland sums to 1.8 MW, which in contrast is 0.1% of the country’s total electricity production. This article is dedicated to the exploration of the potential cost of wind energy production at Búrfell in the south of Iceland. A levelized cost of energy (LCOE) approach was applied to the estimation of the potential cost. Weibull simulation is used to simulate wind data for calculations. A confirmation of the power law is done by comparing real data to calculated values. A modified Weibull simulation is verified by comparing results with actual on-site test wind turbines. A wind farm of 99MWis suggested for the site. Key results were the capacity factor (CF) at Búrfell being 38.15% on average and that the LCOE for wind energy was estimated as 0.087–0.088 USD/kWh (assuming 10% weighted average cost of capital (WACC)), which classifies Búrfell among the lowest LCOE sites for wind energy in Europe

Levelized Cost of Energy Analysis of a Wind Power Generation System at Búrfell in Iceland