Comparison of Renewable Generation Technologies Project
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Contents |
Decision Situation
How do differing renewable energy generation facilities compare using levelized cost of energy versus cost of carbon dioxide abatement?
General Description
An comparison of several different types of modern renewable generation facilities, using the cost of energy generated versus their cost of CO2 emissions offset.
There are a variety of different renewable technologies available to supply energy, but it can be difficult to draw meaningful comparisons between them due to their many differences, such as in capital and operational costs and deliverable power. This investigation provides a simple comparison mechanism to make the differences clearer.
Modeling Methodology
This study seeks to compare several different renewable technologies for cost of energy production and carbon dioxide emissions abatement. This is done through using contemporary examples of the technologies of roughly comparable capacity, and in similar circumstances. We have used to following plants:
1. Sunshine Electricity Cogeneration Plant, located in NE New South Wales
2. Agatsuma Biomass Power Plant, located in Japan
3. Solar Systems Mildura PV Power Plant, located in NW Victoria
4. Cullerin Ranges Wind Farm, located in Southern New South Wales
Due to differing characteristics of these types of power generation a direct comparison is less effective, so levelized cost over an assumed project life span of 30 years has been determined for each of the facilities. This levelized cost incorporates the initial capital costs in conjunction with on going expenses such and operational and feedstock costs (where applicable). A discount rate of 5% is also assumed, and is used for any required interest rates.
In order to facilitate the comparison, the one plant that is located outside of Australia, Agatsuma, has had equivalent costs estimated for it as if it were operated in Australia.
Findings
The results of the analysis indicate that biomass facilities compare very favorably to either wind or solar projects, but particularly solar. This comparison can been seen quite clearly in figure 1 below.
Figure 1: Cost of electricity vs Cost of CO2 abatement
A very substantial element in this result can be explained through the average capacity factor (ACF). The ACF indicates the amount of electrical generation that is supplied from a plant during its normal operation (as averaged over time, in this case a year) in ratio to its maximum possible energy generation over that same time period, based off its capacity rating. Both solar and wind have very low capacity factors (0.2 and 0.38 respectively) due to the limitations on the availability of their energy source. Biomass facilities have very high capacity factors (0.78 and 0.97 for the Sunshine and Agatsuma plants) because they can run at almost peak output continuously. This means that they will generate more electricity which will lower the average cost of electricity as capital expenses will be distributed more thinly. Compounding this for solar is the very high cost of capital infrastructure relative to the other technologies, which in conjunction with its poor ACF places it substantially behind wind generation. Figure 2 displays the ACF values for each of the plants.
Figure 1: First cost of powe vs ACF
Assumptions
The project life for this study will be 30 years [1].
The discount rate that will be used for this study is 0.05[1].
The salvage value of the plants being considered inthe project will be assumed to be 0.0 [1].
The assumed cost price of electricity used in this investigation will be $0.10/kWh [1].
The assumed centralized electricity CO2 emissions per megawatt is 1 tonneCO2e/MWh [1]..
The assumed price of carbon emissions will be assumed for the study to be $20/Tonne for Australia and $0/Tonne for Japan (Australia, Japan)(CO2Price)(20, 0) [1].
Model
The model used to generate this output is an Analytica file Image:PROJECT WORK FIN MODEL(Investment economics, LCC)V4.ANA. In order to view the file follow these instructions How to install the Free Analytica Player.
Inputs
References
| AverageEmissions(TonnesPerMegaWattHour) | 1 + |
| Cite | Geoff Whitfield + |
| DecisionSituation | How do differing renewable energy generation facilities compare using levelized cost of energy versus cost of carbon dioxide abatement? + |
| DiscountRate(Percent) | 0.05 + |
| Price(AudPerKiloWattHour) | 0.1 + |
| Price(AudPerTonne) | (Australia, Japan)(CO2Price)(20, 0) + |
| ProjectLife(Years) | 30 + |
| SalvageValue(Percent) | 0 + |
