Content displaying: CAPEX Definition

Land-Based Wind

CAPEX Definition

Capital expenditures (CAPEX) are expenditures required to achieve commercial operation in a given year.

For the ATB, and based on a capital cost estimates report from EIA (2016) and the System Cost Breakdown Structure defined by Moné et al. (2015), the wind plant envelope is defined to include:

  • Wind turbine supply
  • Balance of system (BOS)
  • Turbine installation, substructure supply, and installation
  • Site preparation, installation of underground utilities, access roads, and buildings for operations and maintenance
  • Electrical infrastructure, such as transformers, switchgear, and electrical system connecting turbines to each other and to the control center
  • Project-related indirect costs, including engineering, distributable labor and materials, construction management start up and commissioning, and contractor overhead costs, fees, and profit.
  • Financial costs
  • Owners' costs, such as development costs, preliminary feasibility and engineering studies, environmental studies and permitting, legal fees, insurance costs, and property taxes during construction
  • Onsite electrical equipment (e.g., switchyard), a nominal-distance spur line (< 1 mile), and necessary upgrades at a transmission substation; distance-based spur line cost (GCC) not included in the ATB
  • Interest during construction estimated based on three-year duration accumulated 10%/10%/80% at half-year intervals and an 8% interest rate (ConFinFactor).

CAPEX can be determined for a plant in a specific geographic location as follows:

CAPEX = ConFinFactor × (OCC × CapRegMult + GCC)
(See the Financial Definitions tab in the ATB data spreadsheet.)

Regional cost variations and geographically specific grid connection costs are not included in the ATB (CapRegMult = 1; GCC = 0). In the ATB, the input value is overnight capital cost (OCC) and details to calculate interest during construction (ConFinFactor).

Standard Scenarios Model Results

ATB CAPEX, O&M, and capacity factor assumptions for the Base Year and future projections through 2050 for Constant, Mid, and Low technology cost scenarios are used to develop the NREL Standard Scenarios using the ReEDS model. See ATB and Standard Scenarios.

CAPEX in the ATB does not represent regional variants (CapRegMult) associated with labor rates, material costs, etc., but the ReEDS model does include 134 regional multipliers (EIA, 2016).

The ReEDS model determines the land-based spur line (GCC) uniquely for each of the 130,000 areas based on distance and transmission line cost.


References are specific to this page, see all references page for all references.

EIA. (2016b). Capital Cost Estimates for Utility Scale Electricity Generating Plants. Retrieved from U.S. Energy Information Administration website:

Moné, C., Smith, A., Maples, B., & Hand, M. (2015). 2013 Cost of Wind Energy Review (No. NREL/TP-5000-63267).