In our previous research, we proposed a method for analyzing the levelized cost of electricity including the marginal system integration cost of additional power generation (LCOE*). During the process of a government committee to verify the electricity costs by generation type, we applied this method to analyze Japan’s power system in 2040 to evaluate the relative competitiveness of power generation technologies, including the evaluation of system integration costs under high penetration of variable renewable energies (VREs). The LCOE*s were calculated for the generation technologies such as commercial-scale solar photovoltaic, on-shore/off-shore wind, nuclear, natural gas, natural gas with H
2, coal, coal with ammonia, natural gas with CCS, and coal with CCS under three VRE deployment cases, based on the LCOEs calculated from the cost and operational assumptions of each generation type and system integration cost through a series of production cost simulations. LCOE*s were also calculated for the utility-scale photovoltaic with demand response, and for utility-scale photovoltaic and wind with battery energy storage, to consider implication from those scenario changes.
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