Two-stage Monte Carlo simulation to forecast levelized cost of electricity for wave energy

Abstract

The technically recoverable global wave energy resource is estimated to be between 2 PWh/year and 5 5 PWh/year, approximately 12% and 32% of global electricity consumption Despite wave energy's vast global potential, there has been relatively little commercial deployment to date. There is large variation in both the current estimated and future expected electricity generation costs associated with wave technologies. This paper quantifies a forecasted levelized cost of electricity (LCOE) for wave energy by performing a two-stage Monte Carlo simulation, considering both the variability in current LCOE estimates and uncertainty in the one-factor learning rate. We compare the forecasted LCOE to wave energy targets of the European Union and U.S. Department of Energy and show the criticality of support mechanisms to achieve learning rates that lead to economic competitiveness in the utility-scale markets.