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I'm curious how they come up with that, actually. Aren't batteries at ~100/KWh at the moment? I would have expected a MWh to be closer to $100k. If I'm not mist
by jsight 8y ago
I'm curious how they come up with that, actually. Aren't batteries at ~100/KWh at the moment? I would have expected a MWh to be closer to $100k. If I'm not mistaken, 1000 cycles at that rate would get you close to $100/MWh.
Obviously I am misunderstanding something in these calculations.
- ben_w 8y agoI assume that one difference is that a facility for LiIon batteries costs more than just LiIon battery cells; and the land, the transformers, the site security, and general maintenance of all the above are non-trivial compared to cell costs?
- acidburnNSA 8y agoYup. Capital cost, operation and maintenance, and charging costs are all added up, financed over the operating period, and turned into a cost to meet an investment IRR of 12%. The table in page 11 of the pdf I linked above breaks it all down.
- zaroth 8y ago12% seems massively high for the risk level. This should be extremely low risk, right?
- lukeschlather 8y agoI think you're reading it as Annual Recurring Revenue rather than Internal Rate of Return. For IRR I think 12% is pretty normal, and depending on how good your project management is it could easily turn into 0%. But I'm not an accountant so I might be misunderstanding.
- xyzzyz 8y agoInvesting in a single facility with unproven technology, without other existing facilities with well known financials is a very risky investment.
- jsight 8y agoOh certainly, but that is kind of my point. The $/KWh seems way too low if that is installed cost. But the levelized cost of energy at the end actually seems pretty reasonable. That means I don't understand where the $/KWh of installed capacity comes from.