Gila River plant

Cost of Energy Resources

TEP can’t take a one-size-fits-all approach to serving our community’s energy needs. We need multiple resources working at the same time to keep your power both reliable and affordable. As we retire coal plants, we’ll need to ramp up our use of efficient natural gas resources. As we expand our portfolio of intermittent renewable resources, we’ll need fast-responding resources such as batteries and reciprocating engines to help us balance the grid.

This chart reports the “levelized cost of energy” in dollars per megawatt-hour for each type of resource in TEP’s portfolio. That amount reflects the total cost of that resource divided by the quantity of energy it is expected to produce over its lifetime.

This calculation takes into account costs for required infrastructure, operation and maintenance, fuel and power transmission. However, it does not include costs related to intermittency or complying with potential future environmental regulations, and it doesn’t reflect certain system benefits such as the contribution the resource makes to the overall adequacy of the local grid.

Costs are shown in 2017 dollars and are based upon figures reported in TEP’s 2017 Integrated Resource Plan, with modifications for certain existing resources.

Levelized Cost of Energy ($/MWh)

Resource definitions