Abstract
The UK government implements carbon price floor to provide long-term incentive to invest in low-carbon technology, thus, fossil-fuel power plants have to face increasing carbon price. This report addresses the effect of carbon price floor on levelised cost of gas-fired generation technology through the levelised cost of electricity (LCOE) ap-proach with the estimation of carbon price floor. Finally, the comparison of levelised cost of electricity for all generation technology in the UK will be shown and discussed.
Highlights
Greenhouse gases (GHG) emitted by human activity are changing global climate with severe effect on our planet
The UK government implements carbon price floor to provide long-term incentive to invest in low-carbon technology, fossil-fuel power plants have to face increasing carbon price
This report addresses the effect of carbon price floor on levelised cost of gas-fired generation technology through the levelised cost of electricity (LCOE) approach with the estimation of carbon price floor
Summary
Greenhouse gases (GHG) emitted by human activity are changing global climate with severe effect on our planet. In 2005, the European Union Emission Trading System (EU ETS), the first emissions trading system in the world, was launched as the most efficient tool to fight Global warming issue [2]. If participants require releasing more GHG emission, they trade emission allowances in the system [3]. The participant of EU ETS includes industrial plants, power stations, aviation and other organizations, and they get emission allowances in two ways using free location, and auction. In the third Phase of EU ETS (From 2013 to 2020), power generators have to auction their allowance at trading platform, and according to the relevant EU legislation, at least half of auctioning revenues and all of the revenue from aviation sec-
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