Analysis of system costs

Ea Energy Analyses has assisted Swedish research institute Energiforsk on an analysis of the system costs of various energy technologies. The analysis has given input to an update of the Energiforsk report from 2014 on electricity from new and future plants (”El från nya och framtida anläggningar 2014”).

LCOE calculations (levelized cost of energy) are carried out for the report for several energy technologies, such as nuclear power, hydro power, vind, solar, CHP, biogas and natural gas. As LCOE does not traditionally take into account that different technologies have different value for the power system, Ea complemented the analysis with a perspective on the system costs. These were analysed by looking at two elements:

• profile cost, an expression of the market value of the electricity generated from the specific technology, compared to the average electricity market price
• balancing cost, meaning the cost/value of handling deviations from the planned production. These costs were determined from current and projected prices for up- or down-ramping production

The result was a system cost adder or cost saver measured in €/MWh determined for each of the 10 technologies today, in 2030, and in 2050. Cost adders and savers were determined for each of the four price areas in Sweden. This complemented the LCOE-calculations and gave a clearer image of the total system value of different technologies.

The project ran from October 2020 to February 2021.