Environmental Engineering Reference
In-Depth Information
Table 7.7
Segregation of costs in UK ESI, 1993/1994. Data in
€
cents/kW h. (Courtesy of David
Milborrow)
Fuel
Operating
Depreciation
Profi t
Total
Generation
2.03
1.28
0.35
0.35
4.01
Control
0.14
0.01
0.03
0.18
Transmission
0.08
0.11
0.16
0.17
0.52
Distribution
0.31
0.80
0.42
0.58
2.11
Supply
0.26
0.01
0.13
0.40
Total
2.42
2.59
0.95
1.26
7.22
The cash - fl ow analysis was carried out for 1993/1994 and costs in nominal money values
have remained similar since that time (which means they have fallen in real terms). The
results of the cash-fl ow analysis are shown in summary form in Table 7.7. The entries for
'fuel' under transmission and distribution cover system losses. The price elements shown in
Table 7.7 apply to the system as a whole. Regional variations occur for many reasons, primar-
ily due to the proximity of a locality to sources of generation.
Although the constituent elements of electricity price shown in the table defi ne its ' value '
at any given point in the system in average terms, it does not follow that electricity which is
injected at that same point will be credited with that same value by the generator or utility.
A brief summary of current attitudes to value is as follows:
•
Fuel.
Most studies accept that fuel savings are a component of the value of renewable
energy. With variable sources, the value declines as the amount of variable capacity
increases.
•
Operating costs.
These include 'fi xed ' and ' variable ' components. The variable costs of
generation are part of the value of RE, but the variable costs of transmission and distribu-
tion are more contentious issues. Acceptance of the fi xed component of these costs as a
component of value depends on whether it is accepted that RE, particularly the variable
sources, has a 'capacity credit', as discussed in Chapter 3.
•
Depreciation.
The crucial point is whether the introduction of RE on to a system enables
plant savings to be made. Most studies have addressed generation plant savings, but more
recent work addresses transmission and distribution savings.
•
Profi t.
The question of profi t as an element of value has not been explicitly addressed. In
a deregulated system, where no single generator or distributor has exclusive rights, it would
seem valid to allow its inclusion, at least partially, in value assessments.
7.5.3 Value of Embedded Generation - Regional and Local Issues
Transmission limitations may sometimes impose constraints [11] on the assimilation of new
generation capacity. For example, in the case of wind in the UK, concentrations of wind in
Scotland and the North of England, where wind speeds are higher than those further south,
may cause an increase in the north-south power fl ows, which are already substantial [12].
