For the eighth consecutive year, wind and solar have claimed the title of the lowest-cost electricity generation resources in the United States when subsidies are stripped away. The latest Lazard Levelized Cost of Energy (LCOE) update, Version 19.0, shows onshore wind holding steady at $37 per megawatt-hour and utility-scale solar rising slightly to $40 per MWh. These figures, as Lazard stresses, represent a “levelized” playing field—removing tax credits and other government supports to reveal the true market cost of each technology. The message is unambiguous: the market continues to reward renewables, and the economics are getting harder to ignore.
Coal, at $72 per MWh, and nuclear, at $175 per MWh, remain far more expensive. While coal’s cost has inched up from $71, nuclear has climbed from $173, and its price tag is now nearly five times that of onshore wind. The high cost is compounded by construction timelines: nuclear projects take the longest to build of any large-scale generation source, often stretching a decade or more. This is not a matter of opinion—it is the arithmetic of capacity factors, capital costs, and operating expenses that Lazard has tracked for two decades. The question of whether the federal government should be “picking winners and losers” is thus answered by the data itself. Subsidies for nuclear, which total over $100 billion in federal commitments, distort a market that would otherwise allocate capital to the cheapest options.
The global trends reinforce this picture. The number of operating reactors has declined over the past two decades, and nuclear’s share of world electricity generation has fallen to 9%. The reasons are not mysterious: high upfront costs, long construction periods, and stiff competition from natural gas and renewables. Even in countries that continue to build nuclear, such as China and Russia, the state directs investment without regard to market returns. The United States, by contrast, relies on competitive wholesale markets. If we trust those markets, the chips fall where they may—and the chips are falling toward wind, solar, and increasingly battery storage.
Proponents of small modular reactors (SMRs) argue that next-generation technology could change the calculus. But Lazard’s analysis deals with the present, not the aspirational. No SMR has yet been licensed and operated in the United States; the earliest plausible deployment is the mid-2030s. Meanwhile, renewable costs continue to decline, and storage is narrowing the gap for dispatchable power. The market is not waiting for a technology that may or may not deliver. Investors and utilities should follow the data, not the hype.
Read the full report at Energy Central.