Title: A probabilistic approach to the computation of the levelized cost of electricity
Authors : Geissmann, Thomas
Ponta, Oriana
Published in : Energy
Volume(Issue) : 124
Pages : 372
Pages to: 381
Publisher / Ed. Institution : Elsevier
Issue Date: 17-Feb-2017
License (according to publishing contract) : Licence according to publishing contract
Type of review: Peer review (publication)
Language : English
Subjects : Invesstment analysis; Levelized cost of electricity; Monte Carlo simulation; Nuclear gas and power; Uncertainty
Subject (DDC) : 333.7: Land, recreational areas and energy
Abstract: This paper sets forth a novel approach to calculate the levelized cost of electricity (LCOE) using a probabilistic model that accounts for endogenous input parameters. The approach is applied to the example of a nuclear and gas power project. Monte Carlo simulation results show that a correlation between input parameters has a significant effect on the model outcome. By controlling for endogeneity, a statistically significant difference in the mean LCOE estimate and a change in the order of input leverages is observed. Moreover, the paper discusses the role of discounting options and external costs in detail. In contrast to the gas power project, the economic viability of the nuclear project is considerably weaker.
Departement: School of Management and Law
Publication type: Article in scientific journal
DOI : 10.1016/j.energy.2017.02.078
ISSN: 0360-5442
URI: https://digitalcollection.zhaw.ch/handle/11475/17392
Appears in Collections:Publikationen School of Management and Law

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