How to Evaluate an Energy Storage Project?

The levelized cost of energy is a value proposition metric that can prove to be useful when assessing investments in energy storage projects. It offers a convenient method of comparing capital costs, operations and maintenance, performance, and fuel costs in different combinations. The formula also considers the lifetime production of a plant, id est, it converts megawatts to megawatts per hour.

What results, then, is a figure that is suitable for comparison to other production costs. The calculator, however, does not take into account financing and discount issues, future replacement, or degradation c0sts.

To calculate the LCOE,

LCOE = (capex + NPV of total opex + NPV of financing costs) / NPV of total electricity production = $ / kWh

where capex = capital expenditure, opex = operational expenditure,  npv = net present value, and kWh = kilowatt hour.

Source and read more 

If you want to know more about this and other topics directly from end users of energy storage technologies join us at one of these annual events: The Energy Storage World Forum (Grid Scale Applications), or The Residential Energy Storage Forum, or one of our Training Courses.

LATEST ARTICLES

Annual Installed Capacity Significantly Increases

While the global market was under the haze of the epidemic and many countries were still in lockdown, the energy storage market showed extremely strong resilience and began to recover and grow since Q3 and Q4 of 2020. According to the BloombergNEF report, the global energy storage market in 2020 has developed faster than expected,…

Read More

Ultracapacitor UPS (U-UPS) for voltage dips and micro-interruptions

Power interruptions are the most frequent power supply problems with wide-ranging consequences for industry. The causes of these interruptions include short-circuits in the distribution grid, lightning strikes, the connection and disconnection of power plants as well as volatile energy producers such as wind and solar. Because technologies and production processes are becoming increasingly complex, the…

Read More

★REVIEWS

“Probably the most interactive and well organized storage event on the calendar.”

★★★★★

Sales Director, S&C

“Great topics, competent speakers, good networking: keep it like that.”

★★★★★

TLC & SCADA Manager, FRI-EL

“High scientific content, well targeted, perfect organization.”

★★★★★

Expert Technical & Governance, Elia

Excellent networking event. The sponsorship was well worth it.”

★★★★★

Manager, ATL

View More

x