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Energy & Renewables vocabulary · Energy Markets and Tariffs

LCOE

Meaning in energy & renewables, with examples

abbreviationCommon term

In energy & renewables, LCOE means: Short for levelized cost of electricity: the average cost of producing one MWh over a plant's whole life, including building, financing, fuel and maintenance costs.

In Turkish: seviyelendirilmiş elektrik maliyeti, LCOE

How it is used

The standard figure for comparing technologies. LCOE is calculated, quoted in currency per MWh and compared across solar, wind, gas and nuclear. It is useful but simple: it ignores when the power is produced and the extra grid or storage costs.

Example sentences

  1. The LCOE of utility-scale solar is now below that of new gas plants in many markets.

  2. A lower interest rate would cut the project's LCOE by about 10 percent.

Common collocations

  • calculate the LCOE
  • low LCOE
  • LCOE per MWh
  • levelized cost of electricity
  • capacity factorThe ratio of the electricity a plant actually produces over a period to what it would produce running at full capacity the whole time, shown as a percentage.
  • power purchase agreementA long-term contract in which a buyer, such as a utility or a large company, agrees to purchase electricity from a specific power project at an agreed price.
  • wholesale marketThe market where electricity is traded in large volumes between generators, suppliers, traders and large consumers before it reaches end customers.
  • installed capacityThe maximum power output that a power plant, or all the plants in a country, can deliver according to their design, usually given in MW or GW.

More terms: Energy Markets and Tariffs

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