UK Levelized Renewable Electricity Costs Continue To Drop

The levelized cost of renewable electricity in the United Kingdom has continued to fall, and recent figures published by the UK Government show that they are lower than ever.

A new report from the UK Government’s Department for Business, Energy & Industry — the new home of the now-defunct Department for Energy and Climate Change — has outlined the the levelized cost of electricity for several renewable energy and gas technologies. ‘Levelized cost’ simply refers to the average cost of the lifetime of a particular technology per MWh of electricity generated, and reflect the cost of building, operating, and decommissioning (or in the case of gas and diesel technologies, a £/kW measurement).

The technologies covered in the report include two gas technologies — Open Cycle Gas Turbines (OCGT) and Cycle Gas Turbines (CCGT) — as well as biomass conversion, offshore wind, large-scale solar PV, and onshore wind greater than 5 MW.

Levelised Cost Estimates, £/MWh

The figures above show the levelized cost of projects commissioned in 2020 and their respective hurdle rates. The report also outlined potential levelized cost estimates for projects commissioning in 2025, which saw offshore wind drop to £100/MWh, large-scale solar PV drop to £63, and onshore wind greater than 5 MW drop to £61.