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<p>Estimates of the levelised costs of electricity generation for different technologies
are published by DECC. The levelised cost of a particular generation technology is
the ratio of the total costs of a generic plant to the total amount of electricity
expected to be generated over the plant’s lifetime (per megawatt hour). Where relevant,
estimates of electricity generation make an allowance for weather conditions based
on estimates of when the relevant energy source is expected to be available, on average,
over a plant’s lifetime (load factors). This is the case for intermittent renewable
technologies such as onshore wind and solar photovoltaic.</p><p>Levelised cost estimates
also depend on other assumptions, including capital costs, fuel and EU ETS allowance
prices, operating costs, discount rates and other drivers. This means that there is
a range around levelised cost estimates.</p><p>The DECC Electricity Generation Costs
(December 2013) report contains DECC’s latest levelised cost estimates.</p>
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