Lazard's Levelized Cost of Storage
The intent of the Levelized Cost of Storage analysis is to provide a transparent, logical methodology for comparing the cost of energy storage across distinct use cases for more than a dozen storage technologies. Utilities, third-party providers, and users can use the levelized approach to get an apples-to-apples view of storage costs vis-a-vis use cases.
Enovation Partners worked with Lazard to develop the methodology, gather the data, and conduct the analysis.
Lazard's LCOS 2.0 is based on hundreds of individual cost estimates and includes a significantly refined methodology for comparing costs, resulting in a narrower range of cost estimates than in LCOS 1.0. Nevertheless, the range of costs within and among use cases and technologies remains striking, reflecting the immaturity of the market.
The new edition includes “Value Snapshots,” which report the profitability of behind-the-meter storage “stacked value” applications (where the storage systems provide multiple revenue or savings streams) across five US markets. Energy storage is “ in the money" in three of those markets, revealing how differences in regional market designs, subsidies, and energy costs impact the economic viability of storage.
How LCOS enables breakthrough advances in energy storage use:
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