Renewable Energy

Energy and Climate Change written question – answered at on 14 October 2013.

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Photo of Brian Binley Brian Binley Conservative, Northampton South

To ask the Secretary of State for Energy and Climate Change what the cross-lifetime consumer end cost is for each mode of renewable energy to produce an average unit of electricity.

Photo of Gregory Barker Gregory Barker The Minister of State, Department of Energy and Climate Change

DECC has not estimated the cross-lifetime consumer end cost for each mode of renewable energy. However, DECC does publish levelised costs estimates of various generation technologies on the DECC website. The levelised cost of electricity generation for a particular technology is the ratio of the total costs of a generic plant to the total amount of electricity expected to be generated over the plant's lifetime (per megawatt hour).

Levelised costs include pre-development costs, capex and infrastructure costs, operating costs, connection costs and where appropriate carbon and fuel costs. Levelised cost estimates 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, discount rate and other drivers and this means that there is uncertainty around these estimates. The latest published figures are available:

https://www.gov.uk/government/publications/decc-electricity-generation-costs-2013

It should be noted that levelised cost estimates are intended to represent the average cost of building a plant and do directly reflect the impacts on the bills of energy consumers.

In addition to levelised costs, DECC publishes estimates of the impacts of policies on energy prices and bills. The latest publication estimates that support for renewable electricity generation through the Renewables Obligation accounts for around 2% (or £30, in real 2012 prices) of the household dual fuel energy bill:

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/172923/130326_Price_and_Bill_ Impacts_Report_Final

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