The aim of this paper is to evaluate the impact of the wake effect on both the steady-state operation and dynamic performance of a wind farm and provide conclusions that can be used as thumb rules in generic assessments where the full details of the wind farms are unknown. A simplified explicit model of the wake effect is presented, which includes: the cumulative impact of multiple shadowing, the effects of wind direction and the wind speed time delay. The model is implemented in MATLAB (R) and then integrated into a power system simulation package to describe the wake effect and its impact on a wind farm, particularly in terms of the wake coefficient and overall active power losses. Results for two wind farm layouts are presented to illustrate the importance of wind turbine spacing and the directionality of wind speeds when assessing the wake effect during steady-state operation and dynamic behavior. (C) 2011 Elsevier Ltd. All rights reserved.