Published in:Hamburg University Working Paper FNU-200, April ; 2013
Extent:
1 Online-Ressource (42 p)
Language:
English
DOI:
10.2139/ssrn.2321127
Identifier:
Origination:
Footnote:
In: Hamburg University Working Paper FNU-200, April 2013
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments April 18, 2013 erstellt
Description:
Despite the rapid decline in the cost of solar photo-voltaic (PV) systems in the past five years, even recent academic research suggests that the cost of generating PV electricity remains too high for PV to make a meaningful contribution to the generation of grid electricity in developing countries. This assessment is reflected in the views of policy-makers throughout Africa, who often consider PV as a technology suited only to remote locations and small-scale applications. This paper therefore analyzes whether, in contrast to conventional wisdom, PV is already competitive with other generation technologies. Analytically, the paper is based on a levelized cost of electricity (LCOE) model to calculate the cost of PV electricity in Kenya, which serves as a case study. Based on actual technology costs and Kenya's solar resource, the LCOE from PV is estimated at USD 0.21/kWh for the year 2011, with scenario results ranging from USD 0.17-0.30/kWh. This suggests that the LCOE of grid-connected PV systems may already be below that of the most expensive conventional power plants, i.e. medium-speed diesel generators and gas turbines, which account for a large share of Kenya's current power mix. This finding implies that researchers and policy-makers may be mistaken in perceiving solar PV as a costly niche technology, rather than a feasible option for the expansion of power generation in developing countries