An interesting chart. The usefulness of LCOE depends on how it is interpreted & used, which requires skills & expertise. Those who know how to use LCOE find these useful.
Few pointers from my experience –
- use it as an analog – to compare your own project LCOE with those versus an absolute. These are inexact models that are meant to compare your understanding
- understand the assumptions – e.g., construction & financing costs, inflation, tax, depreciation, degradation, variable O&M, property tax & insurance, debt/equity ratio, etc. Building these into your LCOE is not trivial. Typically, a project finance model is required
- methodology that went into calculating and what might work – there are many ways to calculate the LCOE,
- working with ranges… developing probability distribution, etc. to understand how your project economics swings with uncertain variables (demand forecast, production…), with these published results, and probe for deeper understanding.
Sadly, most people don’t do the work or not to make the best use of the information that is made available and are outright dismissive, because they did not use it right, got burnt, or treated these as off the shelf numbers and made bad decisions.
#decarbonization #utilities #EnergyTransition #USEnergy
https://decarbonization.visualcapitalist.com/the-cheapest-sources-of-electricity-in-the-us/
