Chasing Grid Parity: Understanding the Dynamic Value of Renewable Energy

The concept of ‘grid parity’ posits that declining costs will cause renewables to become cost-competitive with conventional resources and create a self-sustaining market. However, grid parity is a moving target – as renewable deployments increase, their value in displacing conventional resources dec...

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Bibliographic Details
Published in:The Electricity journal 2012-04, Vol.25 (3), p.17-27
Main Authors: Olson, Arne, Jones, Ryan
Format: Article
Language:English
Subjects:
Cost
Electric power
Energy policy
Markets
Renewable energy sources
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Summary:The concept of ‘grid parity’ posits that declining costs will cause renewables to become cost-competitive with conventional resources and create a self-sustaining market. However, grid parity is a moving target – as renewable deployments increase, their value in displacing conventional resources declines. This means there may be limits to the ability of renewables to compete on cost alone.
ISSN:1040-6190
1873-6874
DOI:10.1016/j.tej.2012.03.001