Cost accounting and economic competitiveness evaluation of photovoltaic power generation in China —— based on the system levelized cost of electricity

Shijia Chong, Jing Wu and I-Shin Chang

Renewable Energy, 2024, vol. 222, issue C

Abstract: Accelerating the penetration of photovoltaics (PV) oriented renewables is a vital mainstay in climate mitigation. Along with continuous growth of PV generation in the power system, PV costs have been rapidly declining. Levelized cost of electricity (LCOE) is commonly applied to cost accounting of energy, while neglecting the specific cost compositions of PV leads to an overly optimistic scenario. By integrating grid costs and balancing costs into conventional LCOE framework, a System LCOE (S-LCOE) model was constructed to evaluate the economic feasibility of PV generation, more accurately. The results revealed that all provincial S-LCOE of China's PV is currently higher than local desulfurized coal electricity price (DCEP). Based on the comparative analysis of provincial S-LCOE and DCEP, four regions with diverse economic competitiveness were identified. PV projects in Region I and Region II are considered to be potentially competitive comparing to thermal generation, in terms of environmental benefits and S-LCOE, especially in Guangdong, Jilin, and Hainan. Furthermore, by simulating the descent trajectory of S-LCOE, we estimate that China will achieve S-LCOE equal to DCEP in Region I as early as 2023, while it will be postponed to 2042 in Region Ⅳ at the latest, depending on different S-LCOE descent rates.

Keywords: Photovoltaics; System levelized cost of electricity; Economic feasibility; Competitive potential; Learning curve (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0960148124000053
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:renene:v:222:y:2024:i:c:s0960148124000053

DOI: 10.1016/j.renene.2024.119940

Access Statistics for this article

Renewable Energy is currently edited by Soteris A. Kalogirou and Paul Christodoulides

More articles in Renewable Energy from Elsevier
Bibliographic data for series maintained by Catherine Liu ().