  With the increasing penetration of renewable energy sources and energy
storage devices in the power system, it is important to evaluate the cost of
the system by using Levelized Cost of Energy (LCOE). In this paper a new
metric, Levelized Cost of Delivery (LCOD) is proposed to calculate the LCOE for
the energy storage. The recent definitions in LCOE for renewable energy system
has been reviewed. From fundamental principles, it is demonstrated that there
is a need to introduce a new method to evaluate LCOE of the system as the
conventional LCOE is not applicable for renewable energy storage systems. Three
years of solar irradiance data in Africa collected from Johannesburg and the
national load data from Kenya are obtained for case studies. The proposed cost
calculation methods are evaluated for two types of storage technologies
(Vanadium Redox Battery (VRB) and Lithium-ion) with real-life data. It shows
that the marginal LCOE and LCOD indices can be used to assist policymakers to
consider the discount rate and the type of storage technology for a cost
effective renewable storage energy system.
