A new tool from the Natural Resources Defense Council (NRDC) can estimate the cost of producing power from different technologies in each part of the country.
NRDC says the tool can help utilities, institutions, state and local policymakers, and the public get better answers about the changing economics of today’s power sector.
The NRDC tool improves upon existing methods to compare – on an apples-to-apples basis – the cost of producing power according to each resource: e.g., large solar, onshore wind, gas, coal and nuclear.
“This tool will provide important additional data to help shape the planning process for meeting our energy needs on a local, state or regional level,” says Sheryl Carter, NRDC’s power sector director. “At a time when cities, states, universities and utilities are considering aggressive climate goals, this knowledge is essential to establishing informed emissions-reduction targets and renewable portfolio standards.”
For each power source, the tool calculates the levelized cost of the electricity, which is the minimum price that electricity must be sold at in order for the energy project generating it to break even. This includes factors such as the cost of building and operating it, as well as how often and how long it will run over its lifetime.
Along with the current generation mix in each state, the tool allows users to see exactly how the levelized costs for different technologies are expected to change annually through 2030 for their state and across the country.
“Solar and wind are already among the least-cost sources of electricity generation across the entire country, and they are expected to become increasingly competitive in the coming years,” Carter says. “Our tool helps make planning for those changes easier.”
Users open the tool, select the state they would like to examine, and compare the cost of generating electricity from various technologies. Those looking to dive deeper can modify several cost and performance assumptions, as well as policies such as a price on carbon, to see how the resulting electricity costs change.
A detailed blog about the tool by NRDC Schneider Fellow Madhur Boloor can be found here.