Ignore any issues associated with peak production

Reference no: EM13185747

Assume that the cost of electricity from a natural gas plant is 5 cents per kilowatt-hour and that the cost of concentrating solar power (e.g., production from a plant like Ivanpah) is 13 cents per kilowatt-hour. Based on our discussion of the external costs of electricity production, is there an economic argument for replacing natural gas generation with solar generation? Is the answer different for coal? (Assume new coal costs 8 cents per kilowatt-hour.) Ignore any issues associated with peak versus off-peak production profiles.

Reference no: EM13185747

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