Episode 182: What are the costs of different types of electricity generation?
We get our electricity from lots of different sources, like coal, natural gas, wind, and nuclear. Which are the cheapest? On this week’s Energy Bite, Nathaniel Horner, a researcher for Carnegie Mellon University’s Engineering and Public Policy Department, has some answers.
Levelized Cost of Energy by U.S. Department of Energy
Levelized Cost of Energy Analysis 9.0 by LAZARD
Electricity Pricing that Reflects its Real-Time Cost by The National Bureau of Economic Research
HOST: We get our electricity from lots of different sources, like coal, natural gas, wind, and nuclear. Which are the cheapest? On this week’s Energy Bite, Nathaniel Horner, a researcher at Carnegie Mellon University, has some answers.
NATHANIEL: Nuclear and hydro plants are expensive to build, but, once running, they produce electricity very cheaply. Coal and natural gas plants are cheaper to build, but can have higher fuel costs. Wind and solar have no fuel costs, but they can’t run all the time. A nuclear plant might last 40 years, while a wind turbine might only last 10. Finally, fossil plants have health and environmental impacts, which are borne by the public. So the answer depends on what type of cost you care about.
HOST: Isn’t there a way to compare different technologies on similar basis?
NATHANIEL: Economists use a calculation called the levelized cost of electricity to adjust for these differences. Currently, natural gas, wind, and geothermal pencil out with the lowest levelized cost. Government subsidies are an important way to adjust levelized cost to account for things it doesn’t include, like impacts from power plant emissions.
HOST: Do you think about the emissions cost of the electricity you consume, or just the charges on your electricity bill? Take our poll, see the results, and ask your energy questions at Energy Bite dot org.