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May 25, 2023
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The costs of electricity generation of different energy sources are often debated. Often, however, no distinction is made as to which specific costs are meant. While renewable energies have marginal costs close to zero and very competitive levelized costs of electricity, a high and increasing share of weather-dependent renewables leads to system costs. They result, for example, from the provision of back-up power plants and the falling average capacity utilization of all existing power plants. We discuss the different types of costs of power generation and note that investments in renewables are easier to realize than the construction of new back-up power plants. [more]
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