Lazard
Summary
Lazard’s latest annual Levelized Cost of Energy Analysis (LCOE 14.0) shows that as the cost of renewable energy continues to decline, certain technologies (e.g., onshore wind and utility-scale solar), which became cost-competitive with conventional generation several years ago on a new-build basis, continue to maintain competitiveness with the marginal cost of selected existing conventional generation technologies.
This year’s LCOE, for the first time, includes a study of hydrogen as a supplemental fuel component for combined cycle gas generation.
Additional highlights from LCOS 6.0:
Sustained cost declines were observed across the use cases analyzed in our LCOS for lithium-ion technologies (on both a $/MWh and $/kW-year basis). The cost declines were more pronounced for storage modules than for balance of system components or ongoing operations and maintenance expenses.
Project returns analyzed in our “Value Snapshots” continue to evolve as hardware costs decline, and the value of available revenue streams fluctuate with market fundamentals.
Project economics analyzed for standalone behind-the-meter applications remain relatively expensive without subsidies, while utility-scale solar PV + storage systems are becoming increasingly attractive.
Long-duration storage is gaining traction as a commercially viable solution to challenges created by intermittent energy resources such as solar or wind.
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