Energy: Power Stations

House of Lords written question – answered on 14th July 2009.

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Photo of Lord Stoddart of Swindon Lord Stoddart of Swindon Independent Labour

To ask Her Majesty's Government what is the cost per unit of electricity provided by (a) wind turbines; (b) coal-fired power stations without carbon capture; (c) coal-fired power stations with carbon capture; (d) gas-fired power stations; and (e) nuclear power stations, including decommissioning costs.

Photo of Lord Hunt of Kings Heath Lord Hunt of Kings Heath Minister of State, Department for Energy and Climate Change, Deputy Leader of the House of Lords, House of Lords, Minister of State (Department of Energy and Climate Change), Deputy Leader of the House of Lords

The Government have carried out analysis on generation costs in some detail 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). More recently the Committee on Climate Change have 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), as set out in table 1 below 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.

It should be noted that the estimates of levelised costs1 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.

Technology Levelised cost (£/MWh) 2010 Levelised cost (£/MWh) 2020
Wind Plant
Onshore Wind (High wind) 65 62
Offshore Wind (High wind) 83 82
Coal-fired plant
Coal—central fuel 54 74
Coal CCS—central fuel 60
Gas-fired plant
CCGT—central fuel 53 61
Nuclear plant
Nuclear 51 47

1 Total lifetime costs of a technology, expressed per-unit. The figure is based on an assumption of the technology's likely output over its lifetime.

The updating of cost assumptions for a range of generation technologies is also ongoing to take account of developments over the last year. 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 the Government's cost assumptions for different forms of generation.

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Peter Rowberry
Posted on 15 Jul 2009 1:36 pm (Report this annotation)

I would point out that the government figures on nuclear (as they point out)are particularly sensitive to the cost of capital, which is a very large contribution to the cost of nuclear generation. Many believe that the way that capital costs are discounted means that they have seriously underestimated this cost. What is more, the costs of waste disposal reflects the government's policy that waste will be paid for for only the first fifty years after handing over to a public repository and do not reflect the real lifetime costs, most of which will be borne by the government and therefore the tax payer.

If the cost of ten thousand years of waste management are added, then nuclear is never going to be cost effective. We should remind ourselves of Jonathon Porritt's statement that no nuclear power station has ever been completed without significant public subsidy.