Full environmental life cycle cost analysis of concentrating solar power technology: contribution of externalities to overall energy costs

B. Corona, E. Cerrajero, G. San Miguel

Research output: Contribution to journalArticleAcademicpeer-review


The aim of this work is to investigate the use of Full Environmental Life Cycle Costing (FeLCC) methodology to evaluate the economic performance of a 50 MW parabolic trough Concentrated Solar Power (CSP) plant operating in hybrid mode with different natural gas inputs (between 0% and 30%). The analysis is based on a plant located in Southern Spain and includes current financial incentives for the promotion of renewable energies. The analysis also incorporates an estimation of external costs associated with atmospheric emissions on six categories: Human Health, Loss of Biodiversity, Local and Global Damage to Crops, Damage to Materials and Climate Change. In a scenario where the project is funded through equity, the life cycle internal costs of the plant operating with solar energy only represent 82.8 €/MW h, while revenues from electricity sales amount to 85.7 €/MW h, resulting in a net present value of 2.95 €/MW h. Internal costs are attributable primarily to the purchase of materials and equipment incurred mainly during the Extraction and Manufacturing life cycle phase. In this scenario, external costs (calculated using CASES damage costs methodology) represent less than 2.6% of all the internal costs considered.

Hybridizing CSP with natural gas allows higher overall power outputs due to extended operating hours. However, this strategy involves higher internal costs, resulting in a significant reduction in the revenues (per unit of power generated) and in the net present value of the project. Thus, the existing regulatory system in Spain makes CSP hybridization with natural gas economically unattractive. In addition, the use of natural gas in CSP installations results in a rapid increase in environmental damage as evidenced by higher external costs. For instance, external unit costs of CSP with 30% natural gas were up to 8.6 times higher than in solar-only operation, due primarily to increased greenhouse gas emissions. When the analysis is extended to consider financing through bank loan under common market conditions, the same project shows economic viability for percentages of natural gas hybridization up to 14%. However, solar-only operation remains as the best option.
Original languageEnglish
Pages (from-to)758-768
JournalSolar Energy
Publication statusPublished - 2016
Externally publishedYes


  • Monetization
  • LCA
  • Solar energy
  • LCC


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