EconomicsUp to date · Jan 15, 2026
Levelized Cost of Energy (LCOE)
The total cost of generating electricity from a system divided by its lifetime energy production. Used to compare energy sources.
Why It Matters
LCOE is the gold standard for comparing the true cost of different energy sources. Residential solar LCOE has dropped below grid electricity in most US states.
Real-World Example
A $20,000 system producing 300,000 kWh over its lifetime has an LCOE of about 6.7¢/kWh — cheaper than the national average of 16¢/kWh.