Sustainability assessment framework for comparing renewable energy investments : holistic integration of environmental, economic, and social impact criteria

Abstract

In the global energy transition to clean energy, it is imperative that renewable energy investments are assessed not only for their economic viability but also the environmental and social impacts. This research introduces a Sustainability Assessment (SA) framework designed to compare investments by combining all three pillars of sustainability. A thorough literature review is conducted to learn from already existing methods, define shortcomings and identify necessary improvements. In total 9 impact categories are proposed, all essential for a holistic SA framework. The chosen method for integrating multiple, non-comparable criteria is Multi-Criteria Decision Analysis (MCDA). By the means of weighing and normalizing, Analytical Hierarchy Process (AHP) holistically integrates 21 different criteria into a single comparable sustainability index. Based on the SA framework, a tool is developed that compares energy investment scenarios.

For tool’s validation, a case study is performed on a 1GW offshore wind compared to a 1GW onshore wind farm and a 50MW photovoltaic solar farm. Life Cycle Assessment (LCA) results indicate that offshore wind farm has with a lower Global Warming Potential of 3.6gCO2eq per kWh and a quicker Energy Payback Time (EPBT) of 6.1 months compared to onshore wind and solar alternatives. Financial assessment highlights the offshore wind farm's higher upfront costs and extended payback time, while having the most expensive Levelized Cost of Electricity (LCOE) of 0.051€/kWh, as compared to 0.038€/kWh for solar, and 0.027€/kWh for the onshore wind farm. Public acceptability surveys favour solar farm with 79% locals in support, as compared to the 74% for offshore and 63% support for onshore wind farm. As the study culminates, the SA framework distinctly positions the 1GW Gulf of Riga offshore wind farm as the most sustainable option, balancing environmental efficacy with respectable financial viability and societal support.

The study-case proves tool’s applicability to various technologies and different capacities, showcasing impressive adaptability to any scenario. SA framework enhances sustainable decision-making in the renewable energy sector by providing stakeholders viable quantitative arguments for future investments. The tool will play a key role in guiding companies towards a more environmentally cleaner, economically feasible, and socially responsible future.