Benchmark report on cost of electricity generation - from nuclear to tidal - updated for 2010 by Parsons Brinckerhoff

Parsons Brinckerhoff, the international engineering consultant and leading power specialist, has today issued the 2010 update to its Powering the Nation report to reflect recent major changes in the economy and in the power plant market. First issued in 2006 - and updated in 2008 - the report is used by both private and public sectors as a benchmark for power generation costs. The 2010 update covers a range of generating technologies including tidal, offshore and onshore wind, combined and open cycle gas turbines, conventional and clean coal, biomass and nuclear. It also factors in the potential cost of carbon capture and storage attached to coal and gas generation. The generating costs (p/kWh - pence per kilowatt hours) for each generation type are shown as a distribution of likely values rather than a single estimate. The company believes this provides a more realistic approach for the range of uncertainty in plant costs applicable to each type. Data is also presented as a typical breakdown of cost contributions from different elements including capital, fuel and other operating costs. Full details are available online at http://www.pbworld.co.uk/index.php?doc=528 [2] Typical cost ranges include: Tidal generation - between 16 and 38 p/kWh
Offshore wind - between 15 and 21 p/kWh
Onshore wind - between 8 and 11 p/kWh
Combined cycle gas turbine – between 6 and 11 p/kWh
Nuclear - between 6 and 8 p/kWh “Presenting findings such as these is always difficult, because there is a tendency for people to only see in them what they want to see. The reality is that in each case, they show there are choices that can be made which affect what the likely cost outcome will be”, explains Paul Willson, author of the update and deputy director of generation at Parsons Brinckerhoff. Parsons Brinckerhoff utilises a sophisticated analysis model, developed specifically for Powering the Nation, which takes account of multiple factors for each generation type including predicted costs for fuel, carbon, operation and maintenance. It also includes factors reflecting optimum plant life and construction scheduling. The cost breakdown of generation technologies emphasises the large variations in capital and fuel price contributions. The renewable technologies all have high capital cost contributions whereas the gas and oil burning gas turbine types all have substantial fuel cost components. Nuclear plant is similar to the renewables in having a high capital cost element with only a small fuel cost component. Plant with carbon capture and storage also has a significantly higher capital cost contribution, reflecting the high investment cost for this technology. The update does not, however, take account of the costs of transmission on the national grid, which reflects current uncertainty relating to the treatment of costs by the transmission system operators for offshore wind and other geographically distributed generation types. For example, if the cost of transmission for offshore wind farms were allocated exclusively to offshore wind generation, it is estimated that this would increase the typical generation costs from this generation source by up to 20 per cent. Issued by: Nick Welsh - tel: 01483 528568; mob: 07770 832838; welshn@pbworld.com [3] Notes to editors: The 2010 update to Powering the Nation closely follows the issue of a separate but related report by Parsons Brinckerhoff at the end of 2009. Powering the Future - mapping our low-carbon path to 2050 which was launched on 23 November 2009 is one of the first comprehensive independent studies to examine the full implications - across transport, industry, residential, commercial and power sectors - of meeting the government’s 2050 carbon reduction commitments. It also identifies critical areas for further in-depth work at a strategic and sector level. The report is available to download at www.pbpoweringthefuture.com [4] Parsons Brinckerhoff (PB) is a global leader in developing and operating infrastructure around the world, with around 15,000 employees dedicated to meeting the needs of clients and communities across Europe, Africa, the Americas, the Middle East, Asia and the Australia-Pacific region. Clients come to PB for a wide range of advice, skills and resources in strategic consulting, programme management, planning, engineering, construction management and operations. For over a century PB has earned a distinguished reputation for delivering world-class infrastructure and its technical expertise in transportation, power, community development, water and the environment. www.pbworld.co.uk [5]