Firm Power Parity: A Framework for Understanding the Disruptive Threat of Solar + Storage

22 Pages Posted: 26 Sep 2017  

Luke Bevan

Centre for Climate Finance & Investment, Imperial College London

Charles Donovan

Centre for Climate Finance & Investment, Imperial College London

Date Written: September 4, 2017

Abstract

This paper proposes a new conceptual framework for understanding competition in electricity markets. Noting that one of the primary drivers for consumers to switch from grid-supplied electricity to self-generated electricity is cost savings, we have constructed a model that forecasts when grid defection may become widespread. Based on detailed modelling of technology cost curves, we estimate the year in which three types of consumers switch to on-site power generation that offers similar reliability and lower cost as grid-supplied electricity. We name these customer switching points “firm power parity.”

Keywords: Energy, Parity, LCOE, Renewables, Self generation, Battery Storage, Photovoltaics, Technology costs

Suggested Citation

Bevan, Luke and Donovan, Charles, Firm Power Parity: A Framework for Understanding the Disruptive Threat of Solar + Storage (September 4, 2017). Available at SSRN: https://ssrn.com/abstract=3031992 or http://dx.doi.org/10.2139/ssrn.3031992

Luke Bevan (Contact Author)

Centre for Climate Finance & Investment, Imperial College London ( email )

South Kensington Campus
Exhibition Road
London, Greater London SW7 2AZ
United Kingdom

Charles Donovan

Centre for Climate Finance & Investment, Imperial College London ( email )

South Kensington Campus
Exhibition Road
London, Greater London SW7 2AZ
United Kingdom

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