Power plant economics: Which type of power plant generally offers the lowest running (operating) cost for producing electrical power, considering fuel and routine operation?

Difficulty: Easy

Correct Answer: hydro electric power plant

Explanation:


Introduction / Context:
Operating (running) cost focuses on day-to-day expenses such as fuel, consumables, and routine operations. Capital cost and construction time are separate considerations. Knowing which plant type has the lowest running cost supports planning of base-load versus peak-load generation portfolios.



Given Data / Assumptions:

  • Running cost emphasizes fuel and regular operation, not initial capital or long-term financing.
  • Hydro plants use water head as the energy source; fuel cost is essentially zero.
  • Steam (coal), gas turbines (gas/jet fuel), and nuclear all have ongoing fuel-related costs and other operating expenses.


Concept / Approach:
Hydroelectric plants convert potential energy of stored water into electricity. Because there is no purchased fuel, their running cost is generally the lowest. Thermal and nuclear plants require continuous fuel supply and associated handling, making their operating cost higher even if fuel prices vary by region and time.



Step-by-Step Solution:

Identify cost categories: capital vs. running.Compare fuels: hydro (none) vs. coal/gas/uranium (non-zero ongoing cost).Conclude: hydro has the lowest running cost for typical systems.


Verification / Alternative check:
Utility cost breakdowns routinely show minimal fuel expense for hydro units. Their primary recurring costs are operations, maintenance, and water management, which are modest per kWh compared to fossil or nuclear fuels.



Why Other Options Are Wrong:

  • Steam power plant: Coal procurement, handling, and emissions control add significant ongoing expense.
  • Gas turbine plant: Fuel cost is substantial; often used for peaking due to high operating cost per kWh.
  • Nuclear plant: While fuel volume is small, fuel cycle, operations, and regulatory requirements raise running costs compared with hydro.


Common Pitfalls:
Conflating operating cost with total cost of ownership; hydro may have high capital cost but still wins on running cost.



Final Answer:
hydro electric power plant

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