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Electricity Generation

Volume 505: debated on Friday 5 February 2010

To ask the Secretary of State for Energy and Climate Change what estimate he has made of the price per megawatt hour of electricity generated over the life cycle of proposed new (a) coal, (b) gas, (c) oil, (d) hydroelectric, (e) nuclear and (f) tidal power generating facilities. (314344)

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)

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

as set out in the following table, including construction, operation and maintenance costs and where applicable the cost of carbon allowances under the European Union emissions trading scheme. Moreover, for nuclear, they also include the costs of decommissioning and waste.


Levelised cost (£/MWh)2010

Coal fired plant

Coal—central fuel


Gas fired plant

Combined cycle gas turbine—central fuel


Nuclear plant




The Committee on Climate Change (2008) “Building a low-carbon economy” p189

Government estimates for the cost of electricity generated from hydroelectric plant were published in the Department of Trade and Industry report “Impact of banding the Renewables Obligation—Costs of electricity production” (2007)


Levelised cost (£/MWh) 2010

Small scale (.<1.25 MW)—central cost


Mid scale (1.25-20 MW)—central cost



DTI (2006) “Impact of banding the Renewables Obligation—Costs of electricity production” p32-34

The estimated costs of tidal generation were estimated as part of the response to the consultation on the Renewable Energy Strategy. These are set out as follows:


Capital cost (£/kW)2008

Operating cost (£/kW/year)

Availability (percentage)

Tidal stream





Redpoint Trilemma (2008) “Implementation of EU 2020 Renewable Target in the UK Electricity Sector: Renewable Support Schemes.”

Government do not have a recent cost estimate for the price per megawatt hour of electricity generated from oil-fired plant.

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.