Projected Costs of Generating Electricity - OECD Nuclear Energy ...

United States
The cost of generating electricity from a given technology is driven by the underlying assumptions
about capital and operating costs. The United States costs reported here are those used by the Energy
Information Administration (EIA) – the independent statistical and analytical agency within the US
Department of Energy (DOE) – in their analytical and forecasting activities. Since most of EIA’s
analytical and forecasting products address broad issues, by necessity, their cost estimates tend to deal
with generic technology forms. Thus, the estimates reported do not reflect the cost of a particular design
of any given technology. Additionally, the estimates reflect the cost of building and operating a power
plant at a typical generic site. Thus, because of siting issues, the estimates may be greater or less than the
realised costs at a particular location.
The data presented generally reflect incremental improvements in costs and performance relative to
2003 levels. Estimates, shown in the table below, were prepared by some of the program offices within
DOE and/or vendors of the technology. These estimates often assume much larger reductions in costs relative
to the ones used by EIA. The larger reductions could be due to accelerated (and successful) R&D
programmes and/or major technological innovations.
The United States levelised costs reported in the questionnaire for this study also include all relevant
taxes and tax credits, whereas the ones computed by the OECD explicitly exclude corporate income taxes
and technology-specific tax subsidies. For this reason among others, the levelised costs reported by EIA
will be different from those presented by the OECD. Additionally, because of differences in taxes in
various countries, even though the underlying cost estimates are similar, the levelised costs reported
by various countries could be very different.
EIA also assumes that all United States power plants will be built in a competitive environment. Studies
have shown that decision makers in such an environment tend to use relatively high discount rates and shorttime
horizons compared with those in regulated industries. Investments in power plants must compete with
Technology n th of a kind n th of a kind Capacity
capital cost heat rate factor
(2003 USD/kW) (Btu/kWh)
Advanced nuclear 1 167 na na
Geothermal 1 475 na 0.85
Landfill gas 1 426 na 0.9
Photovoltaic 1 173 na 0.24
Solar thermal na na 0.28
Biomass 1 308 na 0.8
Wind 887 na 0.48
Pulverised coal 1 127 8 600 na
Integrated gasification
combined cycle power plants 980 5 687 na
Natural gas combined cycle 538 4 960 na
Combustion turbine 380 6 669 na
Abbreviation: na = not applicable because estimate is similar to the one reported in this study.
Note: The cost data includes all contingencies, but excludes “Interest During Construction”.
Sources: Nuclear – Data are consistent with Vendor Estimates.
Renewables – Estimates correspond to Department of Energy Program Office data as found
in National Renewable Energy Laboratory, 2003 Power Technologies Database.
Fossil Fuels – Estimates based on US Department of Energy, Office of Fossil Energy’s Vision
2100 Programme.
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