Lazard's Levelized Cost of Energy Analysis 2025

This technical report presents Lazard's Levelized Cost of Energy (LCOE) Analysis for 2025, detailing significant findings across three primary areas: Energy Generation, Energy Storage, and the Energy System. The report indicates that renewable energy remains the most cost-competitive generation source, particularly in the current high-demand environment. It notes that while the LCOE for new wind and solar technologies is favorable, existing gas generation is becoming increasingly competitive due to low gas prices and high demand. The report also highlights expected shifts in costs for gas technologies due to supply chain issues. In the Energy Storage section, the report documents a decline in the Levelized Cost of Storage (LCOS) driven by market dynamics and technological advancements. Additionally, it discusses the evolving approaches of independent system operators regarding capacity accreditation, which may affect firming costs. The report emphasizes the need for diverse energy resources to meet future power demands, including emerging technologies.