Levelized Cost of Electricity (LCOE)

The cost to produce energy considering the fixed and variable costs of that electricity over time.

The LCOE is the cost of energy from the perspective of the power producer.

\textrm{LCOE} = \frac{\textrm{yearly cost}}{\textrm{yearly energy produced}}

The yearly cost is calculated from the total fixed cost multiplied by the capital recovery factor to account for the cost of capital of the loan. Dividing by the yearly cost of energy yields the cost.

Levelized Avoided Cost of Electricity (LACE)

The value of the energy that did not have to be provided because of a new generation source of energy.

This cost is from the perspective of the entire grid system.

National Energy Modeling System (NEMS)

An integrated model that captures interactions of economic changes and energy supply, demand, and prices

Annual Energy Outlook (AEO)

A projection of future energy use and supply using the NEMS model and other demographic and economic information.

Required by the Department of Energy Organization Act of 1977.

System Average Interruption Frequency Index (SAIFI)

Average number of interruptions that customers experience.

\textrm{SAIFI} = \frac{\textrm{total number of customer interruptions}}{\textrm{total number of customers served}}

PG&E reports a 2021 SAIFI of 1.318.

System Average Interruption Duration Index (SAIDI)

Average duration of interruptions that customers experience.

\textrm{SAIDI} = \frac{\textrm{sum of all customer interruption durations}}{\textrm{total number of customers served}}

PG&E reports a 2021 SAIDI of 218.2 minutes.

Further Reading