Research on Economic Competitiveness of Centralized and Distributed Wind and Solar Power

Development of wind and solar energy has two main modes: centralized and distributed. Based on the analysis of levelized cost of energy (LCOE) formula, this paper summarized the three major factors that affect the development costs of wind and solar power: unit kilowatt investment, utilization hours, operation and maintenance cost ratio. Furthermore, a cost comparison formula was derived to show that the development cost is directly proportional to the ratio of the unit investment of the two and inversely proportional to the ratio of the power utilization hours of the two. Considering the changes of main factors, LCOE calculations method was used to give a cost comparison curve clusters. Finally, the study gives a multi-factor critical point for considering the economic comparison of transmission costs by setting up multi-scenario cases.