Lazard — Levelized Cost of Energy Analysis
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What this document is
‘Lazard’s Levelized Cost of Energy Analysis’ is an annual study, published by the financial advisory firm Lazard, that compares how much it costs to generate electricity from different technologies. It reduces each technology to a single, comparable figure — the levelised cost of energy, or LCOE — so that, for example, a gas plant and a solar farm can be judged on the same terms.
The document referenced here is one edition of that recurring series. This page summarises its method and significance from general knowledge; the specific cost ranges quoted in any given edition should be read from the Lazard original, as they change each year.
What it covers
The analysis works by spreading the total lifetime cost of a plant over all the electricity it is expected to produce. Its broad content includes the following.
- Cost estimates for renewable technologies such as utility-scale solar and onshore wind;
- Cost estimates for conventional generation, including gas and coal;
- The capital, financing, fuel and operating assumptions behind each figure;
- How costs have shifted from one edition to the next, especially the fall in solar and wind;
- Caveats about factors LCOE does not fully capture, such as intermittency and system integration.
A recurring theme is the dramatic decline in the cost of renewables over successive editions, which has reshaped how the electricity industry thinks about new generation.
Why it matters
Because it comes from a respected financial firm and applies a consistent method year after year, the Lazard analysis is one of the most quoted references in debates about renewables competitiveness. It is frequently cited to show that wind and solar have moved from expensive alternatives to among the cheapest sources of new power.
Its wide use means many external links to the original PDF now fail, so a stable summary preserves the reference.
How it relates to UK energy
The cost trends the analysis captures are the reason renewables now dominate new UK generation and increasingly influence wholesale prices. For a British reader, the practical upshot is a growing choice of green tariffs, explored in our guide to renewable energy.
You can find the analysis on Lazard’s website, which hosts current and archived editions.
Frequently asked questions
What is levelised cost of energy (LCOE)?
LCOE is a way of expressing the average cost of generating a unit of electricity over the whole life of a power plant, including building, financing, fuel and running costs. Reducing everything to a single figure per unit of output makes it possible to compare very different technologies fairly.
Who is Lazard and why do they publish this?
Lazard is a financial advisory and asset-management firm. Its energy team has, for years, published an annual LCOE analysis that has become a standard industry benchmark, alongside a companion study on the cost of energy storage.
What is the headline finding over time?
Across successive editions the analysis has documented steep falls in the cost of wind and, especially, solar, to the point where in many settings they became cost-competitive with, or cheaper than, conventional fossil-fuel generation.
Where can I read the original?
Lazard publishes the analysis on its own website. This page links to Lazard so you can find the current and archived editions.