LCOS represents a cost per unit of discharge energy throughput ($/kWh) metric that can be used to compare different storage technologies on a more equal footing than comparing their installed costs per unit of rated energy. Different systems have different calendar life, cycle life, depth of discharge (DOD) limitations, and operations and maintenance (O&M) costs and may require various capital expenditures over time in the form of augmentations, replacements, and major overhauls (ARMO). Each of these characteristics and parameters, in addition to taxes, costs due to debt, and others, ultimately determines the total revenue requirements of a storage system over the lifetime of a project.
The following notes and assumptions apply to the LCOS estimates provided here:
- For almost all technologies, capital costs, O&M costs, and performance parameters correspond with those found in the Energy Storage Cost and Performance Database v.2024 and represent 2023 values. For gravitational and hydrogen systems, capital costs, O&M costs, and performance parameters correspond with 2021 estimates since these technologies were not updated as part of the 2024 effort.
- The financial analysis period for the LCOS calculation is assumed to be 20 years.
- Decommissioning costs are not included in the LCOS calculation shown here due to data availability differences across technologies.
- Augmentations, replacements, and major overhauls (ARMO) for almost all technologies correspond with those found in Table 6.5. Augmentation, Replacement, and Warranty Schedule by Technology in the 2022 Grid Energy Storage Technology Cost and Performance Assessment report. For Vanadium Redox Flow batteries, replacements costs correspond to the cost to replace just the stack ($/kWh) component for the 2024 analysis, at the frequency of the calendar life of the stack.
For more information on the various parameters and methodology, please refer to the LCOS Workbook download and its associated documentation below.