{"id":260510,"date":"2023-06-03T21:02:31","date_gmt":"2023-06-03T19:02:31","guid":{"rendered":"https:\/\/climatescience.press\/?p=260510"},"modified":"2023-06-03T21:02:34","modified_gmt":"2023-06-03T19:02:34","slug":"the-actual-levelized-cost-of-energy","status":"publish","type":"post","link":"https:\/\/climatescience.press\/?p=260510","title":{"rendered":"The Actual Levelized Cost Of Energy"},"content":{"rendered":"\n
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From Watts Up With That?<\/a><\/p>\n\n\n\n

Guest Post By Willis Eschenbach<\/em><\/strong><\/p>\n\n\n\n

A company named Lazard puts out an annual report on something called the \u201cLevelized Cost Of Energy\u201d (LCOE). Here\u2019s the April 2023 version<\/a>. The LCOE estimates the total capital, operations, and maintenance costs for new electric power plants coming into service. People use the Lazard LCOE all the time to claim that renewable electricity sources are now cheaper than fossil fuel electricity. However, the Lazard data has a problem\u2014it doesn\u2019t include the cost of backup and other costs for renewable energy. These costs fall into four groups: backup costs, balancing costs, grid connection costs, and grid reinforcement\/extension costs.<\/p>\n\n\n\n

A few days ago, I posted the following tweet:<\/p>\n\n\n\n

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I am SOOO tired of people using the Lazard\u2019s Levelized Cost of Energy to directly compare say solar vs gas or wind vs coal.<\/p>\n\n\n\n

The Lazard folks themselves say (emphasis mine)<\/p>\n\n\n\n

\u201cDirect comparisons to \u201ccompeting\u201d renewable energy generation technologies must<\/strong> take into account issues such as dispatch characteristics (e.g., baseload and\/or dispatchable intermediate capacity vs. those of peaking or intermittent technologies).\u201d<\/p>\n\n\n\n

It\u2019s not optional, so unless you\u2019re taking those issues into account, you are LYING ABOUT RENEWABLES.<\/p>\n\n\n\n

w.<\/p>\n<\/blockquote>\n\n\n\n

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Fortunately for me, a user yclept <\/a>@Roadshow11235<\/a> gave me a link to something I\u2019d never seen, an analysis of those very costs.<\/a> So let me lay them out for you.<\/p>\n\n\n\n

I\u2019ll start with the original Lazard data.<\/p>\n\n\n\n

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Figure 1. Original April 2023 Lazard Levelized Cost Of Energy (LCOE)<\/em><\/p>\n\n\n\n

Looking at those Lazard LCOE numbers, you can see why people claim that renewables are cheaper than fossil or nuclear. It looks like solar and onshore wind are the clear winners.<\/p>\n\n\n\n

However, and it\u2019s a very big however, this does not include the other costs listed above which mostly affect renewables. Let me define each of them:<\/p>\n\n\n\n