The price of electricity from private power producers: Stage 2, Expansion of sample and preliminary statistical analysis

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The market for long-term bulk power is becoming increasingly competitive and mature. Given that many privately developed power projects have been or are being developed in the US, it is possible to begin to evaluate the performance of the market by analyzing its revealed prices. Using a consistent method, this paper presents levelized contract prices for a sample of privately developed US generation properties. The sample includes 26 projects with a total capacity of 6,354 MW. Contracts are described in terms of their choice of technology, choice of fuel, treatment of fuel price risk, geographic location, dispatchability, expected dispatch niche, ... continued below

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113 p.

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Comnes, G.A.; Belden, T.N. & Kahn, E.P. February 1, 1995.

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Description

The market for long-term bulk power is becoming increasingly competitive and mature. Given that many privately developed power projects have been or are being developed in the US, it is possible to begin to evaluate the performance of the market by analyzing its revealed prices. Using a consistent method, this paper presents levelized contract prices for a sample of privately developed US generation properties. The sample includes 26 projects with a total capacity of 6,354 MW. Contracts are described in terms of their choice of technology, choice of fuel, treatment of fuel price risk, geographic location, dispatchability, expected dispatch niche, and size. The contract price analysis shows that gas technologies clearly stand out as the most attractive. At an 80% capacity factor, coal projects have an average 20-year levelized price of $0.092/kWh, whereas natural gas combined cycle and/or cogeneration projects have an average price of $0.069/kWh. Within each technology type subsample, however, there is considerable variation. Prices for natural gas combustion turbines and one wind project are also presented. A preliminary statistical analysis is conducted to understand the relationship between price and four categories of explanatory factors including product heterogeneity, geographic heterogeneity, economic and technological change, and other buyer attributes (including avoided costs). Because of residual price variation, we are unable to accept the hypothesis that electricity is a homogeneous product. Instead, the analysis indicates that buyer value still plays an important role in the determination of price for competitively-acquired electricity.

Physical Description

113 p.

Notes

OSTI as DE95009372

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  • Other Information: PBD: Feb 1995

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  • Other: DE95009372
  • Report No.: LBL--36054
  • Grant Number: AC03-76SF00098
  • DOI: 10.2172/33134 | External Link
  • Office of Scientific & Technical Information Report Number: 33134
  • Archival Resource Key: ark:/67531/metadc678388

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Office of Scientific & Technical Information Technical Reports

Reports, articles and other documents harvested from the Office of Scientific and Technical Information.

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  • February 1, 1995

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  • July 25, 2015, 2:20 a.m.

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  • April 5, 2016, 12:37 p.m.

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Comnes, G.A.; Belden, T.N. & Kahn, E.P. The price of electricity from private power producers: Stage 2, Expansion of sample and preliminary statistical analysis, report, February 1, 1995; California. (digital.library.unt.edu/ark:/67531/metadc678388/: accessed April 21, 2018), University of North Texas Libraries, Digital Library, digital.library.unt.edu; crediting UNT Libraries Government Documents Department.