An enhanced techno-economic analysis of LCOE: public incentives vs private investment
This paper offers a new approach for the estimation of levelized cost of energy (LCOE) by considering the shareholder internal rate of return (IRR) as an unexplored measure in this kind of analysis. The study relies on a comprehensive techno-economic evaluation based on interactions among a set of f...
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| Format: | Article |
| Language: | English |
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Vilnius Gediminas Technical University
2021-01-01
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| Series: | Technological and Economic Development of Economy |
| Subjects: | |
| Online Access: | https://journals.vgtu.lt/index.php/TEDE/article/view/11259 |
| _version_ | 1818618734305083392 |
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| author | Rogelio Peón Menéndez Alejandro Parra Martín Laura Varela-Candamio María-Teresa García-Álvarez |
| author_facet | Rogelio Peón Menéndez Alejandro Parra Martín Laura Varela-Candamio María-Teresa García-Álvarez |
| author_sort | Rogelio Peón Menéndez |
| collection | DOAJ |
| description | This paper offers a new approach for the estimation of levelized cost of energy (LCOE) by considering the shareholder internal rate of return (IRR) as an unexplored measure in this kind of analysis. The study relies on a comprehensive techno-economic evaluation based on interactions among a set of factors. This mathematical model is then empirically tested for a CSP power plant in Extremadura (Spain) due to their dominant market position and also for being the most developed renewable system at the present. A sensitivity analysis is also performed to establish the influence that market conditions have on the determination of LCOE for different scenarios under the maintenance of a given shareholder IRR for investors. This last assumption makes investment decisions indifferent among several projects in order to focus solely on the minimization of the LCOE. Results reveal that while the annual net electricity production contributes to the reduction of LCOE, total investments, equity percentage and operation and maintenance (O&M) costs help to increase their value by a high percentage. This study gives important scientific basis for investment decision making and also becomes a standpoint to design suitable public incentives that may enhance future technological developments in the CSP generation industry.
First published online 27 February 2020 |
| first_indexed | 2024-12-16T17:26:18Z |
| format | Article |
| id | doaj.art-9d63795889754c44b685a86e883525f4 |
| institution | Directory Open Access Journal |
| issn | 2029-4913 2029-4921 |
| language | English |
| last_indexed | 2024-12-16T17:26:18Z |
| publishDate | 2021-01-01 |
| publisher | Vilnius Gediminas Technical University |
| record_format | Article |
| series | Technological and Economic Development of Economy |
| spelling | doaj.art-9d63795889754c44b685a86e883525f42022-12-21T22:23:03ZengVilnius Gediminas Technical UniversityTechnological and Economic Development of Economy2029-49132029-49212021-01-0127112310.3846/tede.2020.1125911259An enhanced techno-economic analysis of LCOE: public incentives vs private investmentRogelio Peón Menéndez0Alejandro Parra Martín1Laura Varela-Candamio2María-Teresa García-Álvarez3Technology Department, Energy, TSK Group, Gijón, SpainTechnology Department, Energy, TSK Group, Gijón, SpainDepartment of Economics, Faculty of Economics and Business, University of A Coruna, A Coruna, SpainDepartment of Business, Faculty of Economics and Business, University of A Coruna, A Coruna, SpainThis paper offers a new approach for the estimation of levelized cost of energy (LCOE) by considering the shareholder internal rate of return (IRR) as an unexplored measure in this kind of analysis. The study relies on a comprehensive techno-economic evaluation based on interactions among a set of factors. This mathematical model is then empirically tested for a CSP power plant in Extremadura (Spain) due to their dominant market position and also for being the most developed renewable system at the present. A sensitivity analysis is also performed to establish the influence that market conditions have on the determination of LCOE for different scenarios under the maintenance of a given shareholder IRR for investors. This last assumption makes investment decisions indifferent among several projects in order to focus solely on the minimization of the LCOE. Results reveal that while the annual net electricity production contributes to the reduction of LCOE, total investments, equity percentage and operation and maintenance (O&M) costs help to increase their value by a high percentage. This study gives important scientific basis for investment decision making and also becomes a standpoint to design suitable public incentives that may enhance future technological developments in the CSP generation industry. First published online 27 February 2020https://journals.vgtu.lt/index.php/TEDE/article/view/11259renewable energylevelized cost of energycsp energyshareholder returnspublic policyspain |
| spellingShingle | Rogelio Peón Menéndez Alejandro Parra Martín Laura Varela-Candamio María-Teresa García-Álvarez An enhanced techno-economic analysis of LCOE: public incentives vs private investment Technological and Economic Development of Economy renewable energy levelized cost of energy csp energy shareholder returns public policy spain |
| title | An enhanced techno-economic analysis of LCOE: public incentives vs private investment |
| title_full | An enhanced techno-economic analysis of LCOE: public incentives vs private investment |
| title_fullStr | An enhanced techno-economic analysis of LCOE: public incentives vs private investment |
| title_full_unstemmed | An enhanced techno-economic analysis of LCOE: public incentives vs private investment |
| title_short | An enhanced techno-economic analysis of LCOE: public incentives vs private investment |
| title_sort | enhanced techno economic analysis of lcoe public incentives vs private investment |
| topic | renewable energy levelized cost of energy csp energy shareholder returns public policy spain |
| url | https://journals.vgtu.lt/index.php/TEDE/article/view/11259 |
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