Argonne National Laboratory

Assumptions and the Levelized Cost of Energy for Photovoltaics

TitleAssumptions and the Levelized Cost of Energy for Photovoltaics
Publication TypeJournal Article
Year of Publication2011
AuthorsDarling, SB, You, F, Veselka, T, Velosa, A
JournalEnergy and Environmental Science
Date Published01/2011
Other NumbersANL/MCS-P1810-1110

Photovoltaic electricity is a rapidly growing renewable energy source and will ultimately assume a major role in global energy production. The cost of solar-generated electricity is typically compared to electricity produced by traditional sources with a levelized cost of energy (LCOE) calculation. Generally, LCOE is treated as a definite number and the assumptions lying beneath that result are rarely reported or even understood. Here we shed light on some of the key assumptions and offer a new approach to calculating LCOE for photovoltaics based on input parameter distributions feeding a Monte Carlo simulation. In this framework, the influence of assumptions and confidence intervals becomes clear.