Electricity Generation Cost Calculator

What the Calculator Measures

LCOE is a generation-side cost metric. It answers a narrow but useful question: if a plant is built and operated under the assumptions entered, what average electricity price would recover the annualized costs over its useful life?

The calculator reports both dollars per MWh and cents per kWh. One dollar per MWh equals 0.1 cents per kWh.

How to Use the Electricity Generation Cost Calculator

1. Choose a scenario: Start with the baseline assumptions or click a scenario preset such as carbon price, high fuel price, or lower renewable capital costs.
2. Edit source assumptions: For each generation source, enter capital cost, fixed O&M, variable O&M, fuel cost, capacity factor, plant lifetime, and direct emissions.
3. Set financial assumptions: Enter the discount rate and optional carbon price that should apply to every source in the comparison.
4. Compare the cost stack: Click Calculate LCOE to view dollars per MWh, cents per kWh, the lowest-cost source, and the cost component breakdown.

Input Reference

Important Limits

This tool is designed for transparent comparison, not final project finance. It does not model construction schedules, tax credits, local incentives, transmission, storage, curtailment, grid services, outage risk, fuel escalation, water use, land constraints, or dispatch value. For investment decisions, combine LCOE with a full cash-flow model and system reliability analysis.

Frequently Asked Questions

What does LCOE mean?

LCOE means levelized cost of electricity. It converts construction cost, operating cost, fuel cost, plant lifetime, financing, and annual generation into one average cost per unit of electricity, usually dollars per MWh or cents per kWh.

Why does capacity factor matter so much?

Capacity factor measures how much electricity a plant produces compared with running at full output all year. A higher capacity factor spreads capital and fixed operating costs over more MWh, which usually lowers the LCOE.

Does this calculator include transmission or storage?

No. This calculator estimates generation-side LCOE only. It does not include transmission upgrades, grid balancing, storage, curtailment, local taxes, permitting delays, incentives, or reliability value.

Why are the default costs editable?

Electricity project costs vary by country, region, year, technology design, fuel contract, financing, and construction risk. The defaults are planning assumptions, not a live market quote, so you should replace them with values that match your project or study.

How do I compare renewable and thermal sources fairly?

Use consistent financial assumptions, realistic capacity factors, comparable plant lifetimes, and local fuel prices. For system planning, pair LCOE with reliability, dispatchability, land, water, emissions, and grid integration analysis.