Back to Glossary
Financial

Levelized Cost of Energy (LCOE)

The average cost per unit of energy (e.g. per kWh) over the lifetime of a system, accounting for upfront cost, financing, and production. Used to compare solar, wind, or other sources.

Example

Solar LCOE in sunny regions can be $0.05–$0.08/kWh, competitive with or below grid rates.

Related Terms

Payback PeriodROISolar Panel