 A review of the IEA/NEA Projected Costs of Electricity – 2015 editionHisham Khatib Energy Policy, 2016, vol. 88, issue C, 229-233 Abstract: The IEA/NEA recently issued their eighth edition of the Study on the “Projected Costs of Generating Electricity” – 2015 edition. The Study is mainly concerned with calculating the levelised cost of electricity (LCOE). The LCOE calculations are based on a levelised average life time cost approach using the discounted cash flow (DCF) method. The analysis was this year, and for the first time, performed using three discount rates (3%, 7%, and 10%). The LCOE can serve as a tool for calculating the cost of different generation technologies. However the Study's usefulness is affected by its narrow base of a limited set of countries that are not necessarily representative. It ignored the negative role of subsidies and did not provide a methodology for selective application of the discount rates and costing of carbon. The global power generation scene is changing. Generation growth in OECD countries has become very limited; simultaneously there is rapid growth of varying renewables (VRE) generation which needs special criteria for assessing its system cost. All this demands a rethinking of the application and usefulness of the LCOE in future generation planning. Keywords: Generation; System costing; Discount rates; Carbon; Subsidies (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:enepol:v:88:y:2016:i:c:p:229-233 DOI: 10.1016/j.enpol.2015.10.030 Access Statistics for this article Energy Policy is currently edited by N. France More articles in Energy Policy from Elsevier |
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