Answer Happy

1.In figure 1, a private considers two options for electricitygeneration. Suppose the levelized private (or direct) cost (in $)for one KWh of electricity from solar PV is $0.35, in comparison tothe levelized private cost (in $) for one KWh of electricity from acombinedcycle-gas-fired electricity plant is $0.08..Considerationis also given to the following: (a) the gas-fired electricitygeneration produces Carbon dioxide emissions which contributes toglobal warming.
a) Consider that the rate of discount used in figure 1 is 3%.What happen to the private cost of solar PV if the rate of discountis lower to 1% and if the rate of discount is raise to 7%respectively. Base on your findings how crucial is the discountrate in LCOE?
0.4 0.35 0.3 0.25 0.2 0.15 0.1 0.05 0 Solar PV Figure 1 The Levelized Cost of Electricity Generation Combined-cycle gas-fired External cost Private cost The social cost = the private cost + the external cost !!
The levelized cost estimates are based on discounting. The levelized cost of electricity LCOE are defined as: T 1-ΣΥxa+ Σ1*x(1-0) - S F LCOE T T η Σχει The factor y represents the time-value of money [y = 1/(1+r)], r is the discount rate, a is the corporate tax rate, n is the energy production, and T is the life-cycle of the project.