Impact of Renewable Energy Sources on the Electricity Generation Cost

Abstract

The study involves scenario modeling based on the construction of energy chains that determine the flow of energy from the extraction and import of energy resources through technologies for transforming energy forms, transmission and distribution to the final consumer. A fundamental model of the energy system of the Republic of Belarus was also built. The principle of minimizing total system costs is chosen as the objective function for modeling, provided that a number of restrictions imposed on the power system are met. For the purpose of energy system balancing, it was proposed to use the potential of hydropower, viz. existing hydroelectric power plants for scenario 1 and technically possible potential for scenario 2. As a result of the modeling, the structure of electricity production was obtained according to two scenarios. Based on the resulting structure, the cost of producing electrical energy was determined. Two approaches were considered: approach 1 that took into account the cost of electricity production at nuclear power plants which can be classified as new, and approach 2 that took into account the cost of electricity production at nuclear power plants, which can be attributed to the existing generation. The production cost of electricity by 2030 is predicted. When approach 1 is used its level is of 63.3 US dollars/(MW·h) under scenario 2 versus 65.3 US dollars/(MW·h) under scenario 1; when approach 2 is used, its level is of 37.5 US dollars/(MW·h) versus 39.4 US dollars/(MW·h), respectively. Also, the economically feasible potential for using solar energy was determined, which by 2025 will amount to 0.91–1.45 billion kW·h/year, and by 2030 – 2.15–3.46 billion kWh/year; the same for wind energy is 1.55–2.39 billion kW·h/year and 3.69–5.67 billion kWh/year, respectively; the same for hydropower is 1.11–1.45 billion kW·h/year throughout the entire period under review until 2030. Based on the study, it became possible to find out that in the Republic of Belarus it is economically feasible and technically possible to replace up to 20.0 % of electrical energy generation by 2030 with energy produced from renewable energy sources.