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Electricity

Volume 507: debated on Tuesday 9 March 2010

To ask the Secretary of State for Energy and Climate Change what his Department’s latest estimate is of the cost of electricity in pence per kWh provided by (a) coal combustion plants, (b) pulverised fuel steam plants, (c) open-cycle gas turbines, (d) gas combustion plants, (e) nuclear fission plants, (f) biomass combustion plants, (g) offshore wind turbines, (h) onshore wind turbines and (i) wave and marine (hydroelectricity) plants; and if he will make a statement. (321340)

Work is ongoing to update the Department of Energy and Climate Change’s cost assumptions for different forms of generation.

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):

http://www.berr.gov.uk/files/file32014.pdf

The analysis underpinning Renewable Energy Strategy, published in July 2009, used assumptions on the generating costs of different renewable electricity generation technologies, full details of which are set out in Element (2009) and Redpoint/Trilemma (2009), which are available on the DECC website.

Table 1: Levelised cost estimates for renewable generation plant

Technology

Levelised cost (£/MWh)

Wind generation plant

Onshore wind

74-103

Offshore wind

112-131

Biomass plant

Biomass

114-146

Wave and tidal stream

Wave

240

Tidal stream

191

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

http://www.theccc.org.uk/pdf/TSO-ClimateChange.pdf

Their analysis for non-renewable plant is set out in table 2 and include construction, operation and maintenance costs and where applicable the cost of carbon allowances (EU ETS). Moreover, for nuclear, they also include the costs of decommissioning and waste.

Table 2: Levelised cost estimates for non-renewable generation plant

Technology

Levelised cost (£/MWh)

Coal-fired plant

Coal (pulverised fuel)—central fuel

54

Gas-fired plant

CCGT—central fuel

53

Nuclear plant

Nuclear

51

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.