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   The term “levelized cost” when applied to the generation of electricity means that all factors that contribute to the cost of generating electricity over the life of a power plant are taken into consideration. A new report from the OECD Nuclear Energy Agency (NEA) and the International Energy Agency (IEA) states that the levelized cost of low-carbon generation technologies are falling below the levelized cost of conventional fossil fuel generation. The cost of electricity generated by new nuclear power plants remains stable. The report concludes that the electricity from the long-term continuing operation of new nuclear power plants is the least coset option for low-carbon power generation. The report also says that the cost of nuclear electricity is expected to fall further in the near future.
     The title of the new report is Projected Costs of Generating Electricity: 2020 Edition was released today. It is the ninth edition of the IEA and NEA’s joint study of levelized lifetime costs of electrical generation for a broad group of technologies. The 2020 study is based on the expected costs of technologies being built now and commissioned by 2025.
     The predictive study calculates the levelized cost of electricity (LCOE) using discount rates of three percent, seven percent and ten percent. Ut used a combination of generic, country-specific and technology-specific assumptions agreed to by a steering expert group in order to calculate cosets at the plant level. The report is based on information from two hundred and three plants spread over twenty-four OECD and non-OECD countries. These plants included fossil fuel, nuclear and a variety of renewable alternative energy technologies such as hydro, solar, wind and biofuels.
     The LCOE calculations are based on a levelized average lifetime cost approach which utilized the discounted cash flow method. In this method, costs are calculated at the plant level and, therefore, do not include the cost of transmission and distribution. The LCOE calculations also fail to capture other systemic costs and/or externalities that are beyond plant-level CO2 emissions.
     In spite of differences in local, regional, national conditions, the report concludes that low-carbon electrical generation is becoming increasingly cost competitive. Renewable energy costs have continued to fall in recent years. The costs of wind and solar PV are now competitive with fossil fuel-based electricity generation in many countries.
      The reports said that electricity generated by nuclear power is expected to cost less in the near future. Because of cost reductions arising from the lessons learned from sevelal first-of-a-kind projects in several OECD countries, new nuclear power will remain the most dispatchable low-carbon technology with the lowest expected costs in 2025.  The report also said that extending the operation of existing nuclear power plants which is known as long-term operation (LTO) is the most cost-effective source of low-carbon electricity. The report said, “Even at lower utilization rates, a potential scenario for nuclear units in systems with high shares of variable renewables, costs are below those of new investments in other low-carbon technologies.”
     Sama Bilboa y León is the Associate Director of the World Nuclear Association. Commenting on the findings in the new report, he said, “Investing in extending the life of the current fleet of nuclear reactors should be a no-brainer. First, it is the lowest-cost electricity option, second it can make an immediate and significant contribution to job creation in the context of the post-COVID economic recovery, and third – and just as important – many countries will have a hard time meeting their decarbonization targets without the contribution of existing nuclear plants.” The report also mentions that hydropower could provide a similar contribution as nuclear power at comparable costs. However, it remains highly dependent on the “natural endowments” of individual countries.

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