Cost of producing electricity from renewable sources, by IEA-NEA
THE cost of producing electricity from renewable sources like wind and solar has been falling for several years. Now, a new report provides in detail the contrasting costs for different power generation technologies around the world and shows that renewable sources can produce electricity at close to or even below the cost of new fossil fuel-based power stations.
The report, “Projected Costs of Generating Electricity: 2015 Edition,” also showed that new nuclear power plants generate electricity more cheaply than other established “baseload” sources such as coal- and gas-fired power plants over the full lifetime of facilities when financing costs are relatively low.
According to the report, overnight cost for natural gas-fired Combined-Cycle Gas Turbines (CCGTs) in Organisation for Economic Co-operation and Developmen (OECD) countries range from $845/kWe (Korea) to $1 289/kWe (New Zealand).
It added that in Levelised Cost of Electricity (LCOE) terms, costs at a three per cent discount rate range from a low of $61/MWh in the United States to $133/MWh in Japan.
It said that the United States has the lowest cost CCGT in LCOE terms, despite having a relatively high capital cost, which demonstrates the significant impact that variations in fuel price can have on the final cost.
The report stated: “At a seven per cent discount rate, LCOEs range from $66/MWh (United States) to USD 138/MWh (Japan), and at a 10 per cent discount rate they range from $71/MWh (United States) to $143/MWh (Japan). Overnight costs for coal plants in OECD countries range from a low of $1 218/kWe in Korea to a high of USD 3 067/kWe in Portugal. In OECD countries, LCOEs at a three discount rate range from a low of $66/MWh in Germany to a high of $95/MWh in Japan.
At a seven per cent discount rate, LCOEs range from $76/MWh (Germany) to $107/MWh (Japan), and at a 10 per cent discount rate they range from $83/MWh (Germany) to $119/MWh (Japan).
The range of overnight costs for nuclear technologies in OECD countries is large, from a low of USD 1 087/kWe in Korea to a high of $6 215/kWe in Hungary.
LCOEs at a three per cent discount rate range from $29/MWh in Korea to $ 64/MWh in the United Kingdom, $40/MWh (Korea) to $101/MWh (United Kingdom) at a seven per cent discount rate and $51/MWh (Korea) to $136/MWh (United Kingdom) at 10 per cent”.
The IEA said that overnight costs for residential Solar PV range from $1 867/kWe in Portugal to $3 366/ kWe in France. It added that LCOEs at a three per cent discount rate range from $96/MWh in Portugal to $218/MWh in Japan.
At a seven per cent discount rate, LCOEs range from $132/MWh in Portugal to $293/MWh in France. At a 10 per cent discount rate, they range from $162/MWh to $374/MWh, in Portugal for both cases.
For commercial PV, overnight costs range from $1 029/kWe in Austria to U$1 977/kWe in Denmark. LCOEs range from $69/MWh in Austria to $142/MWh in Belgium at a three per cent discount rate, $ 98/MWh (Austria) to $190/MWh (Belgium) at a seven per cent discount rate and $121/MWh (Portugal) to $230/MWh (Belgium) at a 10 per cent discount rate.