Memorandum 80
Supplementary submission from UK Energy
Research Centre
ELECTRICITY COST
ESTIMATES
Estimates of the costs of generating electricity
are frequently presented on a "levelised" basis, which
is a method of allocating the anticipated lifetime costs of the
power station over the anticipated lifetime output. The result
is typically expressed in units of p/kWh or £/MWh. Such cost
estimates are notoriously sensitive to many factors, all of which
in turn have a range of plausible values, so there is significant
uncertainty. This is one of the messages in the 2007 UKERC Investment
in Electricity Generation report.[266]
For this reason, any estimate (whatever the source) that presents
a single number rather than a range should be treated with caution.
A selection of illustrative numbers is shown below:
From House of Commons Environmental Audit Committee
Keeping the lights on: Nuclear, Renewables and Climate Change
(2006). Estimates provided by major generating companies:
|
| Type of generation | Generating cost (p/kWh)
|
| E.ON
| EDF | Centrica
|
|
| CCGT | 2.2-4.9
| 3.8-4.2 | 1.9-2.6 |
| Coal | 2.8-5.2
| 2.5-3.9 | 2.1-3.3 |
| Nuclear | 2.5-4.0
| 2.3 | 2.3-3.4 |
| Wind: onshore | 4.2-5.2
| 3.7-5.4 | 3.1-3.7 |
| Wind: offshore | 6.2-8.4
| 5.5-7.2 | 5.5-7.0 |
| Wave and marine | | 6.6
| 6.0-7.0 |
|
From DTI Energy Review The Energy Challenge (2006).
Estimates calculated by DTI team. These figures are the "base
case" numbers with no CCS costs:
|
| Type of generation | Generating cost (p/kWh)
|
|
| CCGT | 3.4-3.5
| | |
| Coal | 2.7-2.8
| | |
| Nuclear | 3.0-4.4
| | |
| Wind: onshore | 5.1-6.3
| | |
| Wind: offshore | 5.6-8.8
| | |
|
From IEA Projected Costs of Generating Electricity,
2005. The report contains hundreds of estimates for different
technologies and countries—these are the figures provided
for the UK by the DTI:
|
| Type of generation | Generating cost (p/kWh)
|
|
| CCGT | 2.3-2.6
|
| Coal | 3.3-4.4
|
| Nuclear | 2.6-4.7
|
| Wind: onshore | 2.6-4.6
|
| Wind: offshore | 3.8-6.2
|
|
From Enviros Consulting for the DTI The Costs of Supplying
Renewable Energy (2005). Note that these numbers are distilled
from the detailed analysis in the report and the wide ranges on
some of the options reflect the higher costs of exploiting increasingly
marginal sites. The single point estimates reflect the less detailed
analysis which the authors performed for these "high cost"
technologies:
|
Type of
generation | Generating cost (p/kWh)
|
|
| Landfill gas | 4.0+
|
| Wind: onshore | 3.4-11.0
|
| Hydro | 6.5-8.0
|
| Wind: offshore | 7.5
|
| Solar PV | 55.5
|
| Tidal | 10.8
|
| Wave | 13.7
|
| MSW Gasification | 15.9
|
| Biomass: stand alone | 6.6
|
| Biomass—co-firing | 2.7
|
|
AVOIDED CARBON
DIOXIDE EMISSIONS
It is probably most useful to express potential CO2
emission savings in terms of avoided CO2 per GW of
renewable generation installed, to illustrate the likely benefit
of installing (for example) 10GW of offshore wind generation.
The calculation requires a decision on what type of fossil
fuel generation it is anticipated that renewable generation will
displace. Whether the marginal plant in the UK is coal or gas
depends on market conditions so the following illustrations provide
figures for avoided CO2 emissions based on displacing
coal, gas or a mix.
All illustrations are based on 1GW of offshore wind generation,
achieving an average 35% load factor over the course of one year
(8,760 hours). The following CO2 intensities of coal,
gas and wind generation are taken from the 2006 Energy Review
(which in turn used figures from OECD):
|
| Type of generation | CO2 intensity (tonnes CO2/GWh of electricity generated)
|
|
| Coal | 755
|
| CCGT | 385
|
| Wind | 11 |
|
Note that these numbers are for new fossil plant—older
plant (which may be more likely to be displaced) may be less efficient
and have a higher CO2 intensity. Note also that DUKES
2007 quote a figure of 481 tonnes CO2/GWh for the entire
UK generation mix and some might argue that this figure should
be used.
These translate into the following CO2 savings
per GW of offshore wind:
— CO2 savings if displacing coal:
(1GW x 35% x 8,760 hours = 3,066GWh) x (755-11) = 2,281,104
tonnes CO2/year.
— CO2 savings if displacing gas:
(1GW x 35% x 8,760 hours = 3,066GWh) x (385-11) = 1,146,684
tonnes CO2/year.
— CO2 savings if displacing coal/gas mix (50%
split):
(1GW x 35% x 8,760 hours = 3,066GWh) x (570-11) = 1,713,894
tonnes CO2/year.
— CO2 savings if displacing entire mix:
(1GW x 35% x 8,760 hours = 3,066GWh) x (481-11) = 1,441,020
tonnes CO2/year.
April 2008
266
Gross, R, P Heptonstall & W Blyth (2007), Investment in
electricity generation: the role of costs, incentives and risks,
UK Energy Research Centre, London. Back
|
