Limitations of LCOE Sample Clauses

Limitations of LCOE. As noted previously, LCOEs have been criticized for the inability to provide adequate comparisons of the costs of technologies, especially when comparing intermittent renewables (Xxxxxxxxxx et al, 2016). Indeed, as argued above, there are a number of factors which are not incorporated in current LCOEs calculations. These costs can occur at any point of the value chain, starting from the direct costs of producing a unit of power and ending with the final prices of electricity. In terms of actual plant investment decisions, factors other than LCOE must be considered in the decision-making process. These include, for instance, projected utilization rates, which are based on the load curve and existing generation mix, and capacity values, namely the ability of a plant to reliably meet demand, Regulations and policy may also have an effect on overall costs which are not reflected in LCOE, e.g. taxes, changing allotments of EU ETS credits, or country- specific feed-in tariffs. Another factor which likely impac ts LCOE estimates of renewables e.g. wind and solar, more than those of traditional fossil based are system costs. Essentially these are the costs embodied in connecting renewable generation sources to the larger energy grid, and are discussed more in depth in the following section.