THE SOURCE - Fall 2017 - 20

feature

Levelized Cost of Energy
(LCOE) and How it Affects
the Direct-Use of

NATURAL GAS
hile the "E" in LCOE supposedly stands for energy, in practice, the "E" stands for
electricity. Such studies are highly complex and non-transparent models ostensibly
intended to help guide energy decision-makers conducting analyses to compare the
relative bang-for-the-buck of electric energy generation systems. The Department of
Energy's (DOE) Energy Information Agency (EIA) is one such governmental entity that
publishes LCOEs. To a large extent, LCOEs are artifacts of the days when monopoly utilities
were the only ones building power plants. Today, they are used mostly to justify technology preferences in public policy.
So far, however, no one has tried to
include alternatives to electricity in LCOE
analysis. This sets the stage for ignoring
the merits of natural gas direct-use
alternatives to electricity, a dramatic sin
of omission. Our ongoing study intends
to change that. It also intends to test the
concept on an appliance-by-appliance
basis. Here's why:
* To date, all LCOEs do is estimate the
average cost of a unit of electricity
over the life of a given electricity
generation technology (e.g., coal, gas,
nuclear, renewable, etc.); and,
* Furthermore, various interested
parties employ LCOEs to make the

case for one or the other form of
electric generation while not fully
considering the costs of getting that
electric energy to the consumers'
meter and then through their energy
consuming apparatus to provide
what they are looking for (e.g.,

heating, cooling, cooking, drying,
lighting, etc.).
In short, LCOEs have become
politicized. Conservatives tend to use
LCOEs to demonstrate the superiority
of fossil fueled electric generation
whereas progressives tend to use LCOEs

To a large extent, LCOEs are artifacts of
the days when monopoly utilities were the
only ones building power plants. Today,
they are used mostly to justify technology
preferences in public policy.

20 THE SOURCE | THE VOICE AND CHOICE OF PUBLIC GAS



Table of Contents for the Digital Edition of THE SOURCE - Fall 2017

First Person
APGA Events
A Conversation with an APGA Member: Southeast Gas
Update on DOE’s Furnace Rule
The Second Annual NGV Road Rally
Levelized Cost of Energy (LCOE) and How it Affects the Direct-Use of Natural Gas
APGA Strategic Planning: What’s Next?
Growing Revenue Without Capital - Combined Heat and Power
APGA Endorses Leading Home Repair Provider
Legislative Outlook
The Pipeline
Marketing Matters
At Last
THE SOURCE - Fall 2017 - intro
THE SOURCE - Fall 2017 - ebelly1
THE SOURCE - Fall 2017 - ebelly2
THE SOURCE - Fall 2017 - cover1
THE SOURCE - Fall 2017 - cover2
THE SOURCE - Fall 2017 - 3
THE SOURCE - Fall 2017 - 4
THE SOURCE - Fall 2017 - 5
THE SOURCE - Fall 2017 - 6
THE SOURCE - Fall 2017 - 7
THE SOURCE - Fall 2017 - First Person
THE SOURCE - Fall 2017 - 9
THE SOURCE - Fall 2017 - APGA Events
THE SOURCE - Fall 2017 - 11
THE SOURCE - Fall 2017 - A Conversation with an APGA Member: Southeast Gas
THE SOURCE - Fall 2017 - 13
THE SOURCE - Fall 2017 - 14
THE SOURCE - Fall 2017 - 15
THE SOURCE - Fall 2017 - 16
THE SOURCE - Fall 2017 - Update on DOE’s Furnace Rule
THE SOURCE - Fall 2017 - The Second Annual NGV Road Rally
THE SOURCE - Fall 2017 - 19
THE SOURCE - Fall 2017 - Levelized Cost of Energy (LCOE) and How it Affects the Direct-Use of Natural Gas
THE SOURCE - Fall 2017 - 21
THE SOURCE - Fall 2017 - APGA Strategic Planning: What’s Next?
THE SOURCE - Fall 2017 - 23
THE SOURCE - Fall 2017 - 24
THE SOURCE - Fall 2017 - 25
THE SOURCE - Fall 2017 - Growing Revenue Without Capital - Combined Heat and Power
THE SOURCE - Fall 2017 - 27
THE SOURCE - Fall 2017 - APGA Endorses Leading Home Repair Provider
THE SOURCE - Fall 2017 - 29
THE SOURCE - Fall 2017 - Legislative Outlook
THE SOURCE - Fall 2017 - 31
THE SOURCE - Fall 2017 - 32
THE SOURCE - Fall 2017 - 33
THE SOURCE - Fall 2017 - The Pipeline
THE SOURCE - Fall 2017 - 35
THE SOURCE - Fall 2017 - Marketing Matters
THE SOURCE - Fall 2017 - 37
THE SOURCE - Fall 2017 - 38
THE SOURCE - Fall 2017 - 39
THE SOURCE - Fall 2017 - At Last
THE SOURCE - Fall 2017 - 41
THE SOURCE - Fall 2017 - 42
THE SOURCE - Fall 2017 - cover3
THE SOURCE - Fall 2017 - cover4
THE SOURCE - Fall 2017 - outsert1
THE SOURCE - Fall 2017 - outsert2
THE SOURCE - Fall 2017 - outsert3
THE SOURCE - Fall 2017 - outsert4
https://www.nxtbook.com/naylor/PGAQ/PGAQ0218
https://www.nxtbook.com/naylor/PGAQ/PGAQ0118
https://www.nxtbook.com/naylor/PGAQ/PGAQ0417
https://www.nxtbook.com/naylor/PGAQ/PGAQ0317
https://www.nxtbook.com/naylor/PGAQ/PGAQ0217
https://www.nxtbook.com/naylor/PGAQ/PGAQ0117
https://www.nxtbook.com/naylor/PGAQ/PGAQ0416
https://www.nxtbook.com/naylor/PGAQ/PGAQ0316
https://www.nxtbook.com/naylor/PGAQ/PGAQ0216
https://www.nxtbook.com/naylor/PGAQ/PGAQ0116
https://www.nxtbook.com/naylor/PGAQ/PGAQ0415
https://www.nxtbook.com/naylor/PGAQ/PGAQ0315
https://www.nxtbook.com/naylor/PGAQ/PGAQ0215
https://www.nxtbook.com/naylor/PGAQ/PGAQ0115
https://www.nxtbookmedia.com