In the United States, new offshore wind power-generating sites entering the grid in 2028 had estimated capital costs of 89.61 U.S. dollars per megawatt-hour, as of 2022 calculations. Advanced nuclear plants had an estimated cost of 62.17 dollars per megawatt-hour. The more difficult the initial construction of a power plant, the higher the associated capital costs.
What are levelized capital costs?
The levelized cost of energy (or LCOE) is a comparative indication of the financial viability of different forms of energy over a system’s lifetime. Capital costs are the one-time expenses of acquiring the land, equipment, and construction resources to start a project. A decrease in the cost of renewable energy technologies over the past decades was an important factor in the rapid expansion of these technologies. For example, the cost of solar PV electricity worldwide declined by more than 88 percent between 2010 and 2021.
Harvesting wind from the sea
Despite the higher capital costs of building wind turbines in bodies of water, the high economic potential for fixed-bottom and floating offshore wind technologies is nevertheless predicted off the Atlantic coast, particularly in New England. While U.S. investors and politicians have been relatively skeptical towards the establishment of offshore wind farms in the past, the Biden administration strengthened the offshore wind energy sector. As of 2022, the offshore wind capacity pipeline in the U.S. stood at more than 40 gigawatts.
Estimated levelized capital costs of electricity for new power plants in the United States with operation start in 2028, by energy source
(in U.S. dollars per megawatt-hour)
Unweighted average levelized costs in 2022 U.S. dollars
Supplementary notes
* According to the source, hydroelectric and hybrid solar PV generating assets are assumed have seasonal and diurnal storage, respectively, so that they can be dispatched within a season or a day, but overall operation is limited by resource availability by site and season for hydroelectric and by daytime for hybrid solar PV.
** Technology is assumed to be photovoltaic (PV) with single-axis tracking. The solar hybrid system is a single-axis PV system coupled with a four-hour battery storage system. Costs are expressed in terms of net AC power available
to the grid for the installed capacity.
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EIA. (March 16, 2023). Estimated levelized capital costs of electricity for new power plants in the United States with operation start in 2028, by energy source (in U.S. dollars per megawatt-hour) [Graph]. In Statista. Retrieved October 31, 2024, from https://www.statista.com/statistics/194327/estimated-levelized-capital-cost-of-energy-generation-in-the-us/
EIA. "Estimated levelized capital costs of electricity for new power plants in the United States with operation start in 2028, by energy source (in U.S. dollars per megawatt-hour)." Chart. March 16, 2023. Statista. Accessed October 31, 2024. https://www.statista.com/statistics/194327/estimated-levelized-capital-cost-of-energy-generation-in-the-us/
EIA. (2023). Estimated levelized capital costs of electricity for new power plants in the United States with operation start in 2028, by energy source (in U.S. dollars per megawatt-hour). Statista. Statista Inc.. Accessed: October 31, 2024. https://www.statista.com/statistics/194327/estimated-levelized-capital-cost-of-energy-generation-in-the-us/
EIA. "Estimated Levelized Capital Costs of Electricity for New Power Plants in The United States with Operation Start in 2028, by Energy Source (in U.S. Dollars per Megawatt-hour)." Statista, Statista Inc., 16 Mar 2023, https://www.statista.com/statistics/194327/estimated-levelized-capital-cost-of-energy-generation-in-the-us/
EIA, Estimated levelized capital costs of electricity for new power plants in the United States with operation start in 2028, by energy source (in U.S. dollars per megawatt-hour) Statista, https://www.statista.com/statistics/194327/estimated-levelized-capital-cost-of-energy-generation-in-the-us/ (last visited October 31, 2024)
Estimated levelized capital costs of electricity for new power plants in the United States with operation start in 2028, by energy source (in U.S. dollars per megawatt-hour) [Graph], EIA, March 16, 2023. [Online]. Available: https://www.statista.com/statistics/194327/estimated-levelized-capital-cost-of-energy-generation-in-the-us/