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Levelized Full System Costs of Electricity

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  • Idel, Robert

Abstract

Different electricity generating technologies are often compared using the Levelized Costs of Electricity (LCOE), which summarize different ratios of fixed to variable costs into a single cost metric. They have been criticized for ignoring the effects of intermittency and non-dispatchability. This paper introduces the Levelized Full System Costs of Electricity (LFSCOE), a novel cost evaluation metric that compares the costs of serving the entire market using just one source plus storage. Like LCOE, and in contrast to alternatives such as System LCOE, LFSCOE condense the cost for each technology into one number per market. The paper calculates LFSCOE for several technologies using data from two different markets. It then discusses some refinements, including the LFSCOE-95 metric that require each technology to supply only 95% of total demand.

Suggested Citation

  • Idel, Robert, 2022. "Levelized Full System Costs of Electricity," Energy, Elsevier, vol. 259(C).
    • Handle: RePEc:eee:energy:v:259:y:2022:i:c:s0360544222018035
    DOI: 10.1016/j.energy.2022.124905
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    References listed on IDEAS

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    Cited by:

    1. Chong, Shijia & Wu, Jing & Chang, I-Shin, 2024. "Cost accounting and economic competitiveness evaluation of photovoltaic power generation in China —— based on the system levelized cost of electricity," Renewable Energy, Elsevier, vol. 222(C).
    2. S. V. Zhukov & O. B. Reznikova, 2023. "Energy Transition in the United States, Europe and China: Latest Trends," Studies on Russian Economic Development, Springer, vol. 34(4), pages 439-449, August.
    3. Yuhji Matsuo, 2022. "Re-Defining System LCOE: Costs and Values of Power Sources," Energies, MDPI, vol. 15(18), pages 1-39, September.
    4. Steele, Amanda Harker & Sharma, Smriti & Pena Cabra, Ivonne & Clahane, Luke & Iyengar, Arun, 2023. "A tool for measuring the system cost of replacement energy," Energy, Elsevier, vol. 275(C).

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