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Analysis of the impact of technical and economic parameters on the specific cost of electricity production

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  • Bartnik, Ryszard
  • Hnydiuk-Stefan, Anna
  • Buryn, Zbigniew

Abstract

This paper reports the results of analysis of technical and economic parameters on the specific cost of electricity production. The use of a particular technology determines the value of the investment needed for the construction of a power plant, its energy efficiency, internal electrical load of the power plant and its annual operating time. Besides, this cost is considerably dependent on the interest rate on the capital, fuel prices and environmental charges as well as, equally importantly, their variability in time. The variability in the prices of energy carriers and their mutual relations are inevitable for a number of reasons. As shown in the paper the change of the technical parameters in the range of the possible boundaries in a particular technology cannot considerably reduce the specific cost of electricity production. The reduction of the current price relation between gas and three-times cheaper coal (calculated per specific unit of energy) can considerably improve the profitability of the use of the gas-steam technology. When the ratio of the cost of fuel in the specific cost of electricity production is small, the impact of the fuel price on its value is also insignificant.

Suggested Citation

  • Bartnik, Ryszard & Hnydiuk-Stefan, Anna & Buryn, Zbigniew, 2018. "Analysis of the impact of technical and economic parameters on the specific cost of electricity production," Energy, Elsevier, vol. 147(C), pages 965-979.
    • Handle: RePEc:eee:energy:v:147:y:2018:i:c:p:965-979
    DOI: 10.1016/j.energy.2018.01.014
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    References listed on IDEAS

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    1. Ajayi, Victor & Weyman-Jones, Thomas & Glass, Anthony, 2017. "Cost efficiency and electricity market structure: A case study of OECD countries," Energy Economics, Elsevier, vol. 65(C), pages 283-291.
    2. Ouyang, Xiaoling & Lin, Boqiang, 2014. "Levelized cost of electricity (LCOE) of renewable energies and required subsidies in China," Energy Policy, Elsevier, vol. 70(C), pages 64-73.
    3. Geissmann, Thomas, 2017. "A probabilistic approach to the computation of the levelized cost of electricity," Energy, Elsevier, vol. 124(C), pages 372-381.
    4. Boccard, Nicolas, 2014. "The cost of nuclear electricity: France after Fukushima," Energy Policy, Elsevier, vol. 66(C), pages 450-461.
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    Cited by:

    1. Ryszard Bartnik & Zbigniew Buryn & Anna Hnydiuk-Stefan & Adam Juszczak, 2018. "Methodology and a Continuous Time Mathematical Model for Selecting the Optimum Capacity of a Heat Accumulator Integrated with a CHP Plant," Energies, MDPI, vol. 11(5), pages 1-17, May.
    2. Ryszard Bartnik & Waldemar Skomudek & Zbigniew Buryn & Anna Hnydiuk-Stefan & Aleksandra Otawa, 2018. "Methodology and Continuous Time Mathematical Model to Select Optimum Power of Gas Turbine Set for Dual-Fuel Gas-Steam Combined Heat and Power Plant in Parallel System," Energies, MDPI, vol. 11(7), pages 1-22, July.

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