Thursday 15 September 2011

True energy costs

Canberra Times
2 September 2011, Page: 16

The Canberra Times has published many letters on the cost of renewable energy where the levelised cost of energy (LCE) from the US Department of Energy is used both for and against renewable energy. Unfortunately the LCE is an inappropriate measure because it includes a discount term which leads to strange results. I can sell the energy from solar panels back to ACTEW for the same price ACTEW charges me.

If I calculate the LCE with a discount rate of 1% the LCE measure says that I am losing money and a discount rate of 7% means I am losing serious money. Yet the solar panels on my roof will give me a real return of 6% per annum for the next 30 years. The LCE measure is clearly inappropriate. Long-term investments that return inflation-proof returns are sensible investments. Almost all forms of renewable energy are economic if we use common sense measures.

Kevin Cox, Ngunnawal

1 comments:

laya said...

Nice post! If cost of the solar panels is stable really it will help people to invest on it and sure it will make the environment green. In future renewable energy should be used to save our natural resources so the process which makes the installation of
solar system
will be the good one. Thanks for the share! Keep posting!!