§ Mr. Marlow
asked the Secretary of State for Energy if he will give comparisons of the capital cost of new generating capacity in p/kwh for oil-fired, coal-fired and nuclear generators, breaking down the costs into loan, depreciation and maintenance and setting out the period of write-off in each case.
§ Mr. Norman Lamont
Calculations of the capital costs of new generating capacity in p/kwh depend upon the methods used and assumptions made. I am advised by the CEGB that, as an example, on the basis of the capital costs of Heysham II and of completing Drax as given in my answer to the hon. Member on 19 July—Official Report, c. 814—converted into annuities at the required rate of return of 5 per cent. and divided by units supplied at an assumed annual load factor of 75 per cent. give:
p/kwh Heysham II … … … 0.80 Drax completion … … … 0.40
The annuity covers the cost of depreciation and return on capital over the writing-off period which, in the case of Heysham II, is taken as 20 years and for Drax completion 25 years.
The CEGB has not ordered an oil station recently. There is no reason to think that the maintenance costs per kwh will differ significantly from those shown for the different types of station in 1977–78 in my previous answer.