Skip to main content

Electricity Generation: Costs

Volume 501: debated on Wednesday 2 December 2009

To ask the Secretary of State for Energy and Climate Change what his most recent estimate is of the average cost of generating 1 MW of electricity by each different generating technology. (303523)

The Government have carried out analysis on generation costs in recent years to inform policy decisions. Some of these estimates were published as part of the Energy Review (2006) at:

More recently the Committee on Climate Change (CCC) have published estimated levelised costs (£/MWh, in 2008 prices) associated with 1 MWh of electricity generated, for their December 2008 report at:,

as set out in table 1 and include construction, operation and maintenance costs and where applicable the cost of carbon allowances (EU emissions trading scheme). Moreover, for nuclear, they also include the costs of decommissioning and waste.

It should be noted that the estimates of levelised costs for different types of electricity generation are highly sensitive to the assumptions used for capital costs, fuel and EU ETS allowance prices, operating costs, load factor, and other drivers. In reality, there are large uncertainties and ranges around these figures.


Levelised cost (£/MWh) 2010

Wind plant

Onshore wind (high wind)


Offshore wind (high wind)


Coal-fired plant

Coal—central fuel


Gas-fired plant

CCGT—central fuel


Nuclear plant




The Committee on Climate Change (2008) ‘Building a low-carbon economy’ p189.

The costs of most generation technologies have increased over the past 18 months, primarily due to increases in input prices. Work is ongoing to update Government’s cost assumptions for different forms of generation.