Grid positioning shapes renewable returns beyond LCOE, Aurora argues

Aurora Energy Research released a piece contending that grid positioning shapes renewable project returns in ways that LCOE alone does not capture. The argument centres on how a project's location within a bidding zone affects its realised capture price relative to the wholesale price index.

Curtailment exposure and transmission congestion both compress capture prices for assets poorly positioned on the grid. Aurora's framing implies that two projects with identical LCOE figures can produce materially different equity returns depending on where they connect. The publication does not supply zone-specific numbers in the publicly available summary, so quantified capture price gaps by location are not confirmed here.

The piece adds to a growing body of analysis pushing European project finance teams to move beyond flat LCOE comparisons when underwriting new build. Grid connection strategy, including proximity to load centres and headroom on local network infrastructure, feeds directly into the revenue stack.