In September 2014, Lazard published its annual levelized cost of energy (LCOE) report. The analysis calculates the LCOE of renewable technologies in the absence of subsidies, such as the federal Investment Tax Credit or the Production Tax Credit. Lazard finds the LCOE of wind and utility-scale solar PV is competitive with coal and becoming competitive with combined cycle natural gas.
There is a growing business case to add cost effective utility-scale renewables to the generation portfolio; however, the business case becomes more complex with high penetrations of renewables. In these scenarios, utilities and ISO/RTOs must be capable of managing significant variable generation as part of normal grid operations. In addition, determining “high penetration” is unique to each gird operator and dependent on local and regional system characteristics.
This report is part of the Clean Tech & Sustainability Minute series. To view all featured Minutes, please click here.
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