Abstract :

Afghanistan faces significant challenges in achieving reliable, affordable, and sustainable electricity supply while remaining heavily dependent on imported electricity. Despite possessing abundant renewable energy resources, including solar, wind, and hydropower, comprehensive economic assessments of electricity generation technologies under Afghan conditions remain limited. This study presents a comparative Levelized Cost of Energy (LCOE) analysis of six power generation technologies relevant to Afghanistan’s energy sector: Solar Photovoltaic (PV), Wind, Hydropower, Combined Cycle Gas Turbine (CCGT), Coal-Fired Power Plants, and Biomass. A discounted cash flow methodology is employed using technology-specific technical and economic parameters representative of Afghanistan. The analysis incorporates capital expenditure, operation and maintenance costs, fuel costs, capacity factors, plant lifetimes, and financing conditions. Sensitivity analysis is performed across a range of weighted average cost of capital (WACC) values from 5% to 18% to evaluate the impact of financing risk on generation costs. Results indicate that hydropower exhibits the lowest LCOE, followed by utility-scale solar PV and wind power. Renewable technologies demonstrate strong economic competitiveness while simultaneously achieving near-zero operational carbon emissions. The findings highlight the importance of low-cost financing and provide evidence-based guidance for future energy planning, investment prioritization, and sustainable electricity sector development in Afghanistan.

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Keywords :

Afghanistan, energy economics, energy policy, hydropower, levelized cost of energy, Renewable Energy, Solar PV., wind energy.

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