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In its simplest form, electricity is made from turbines that are driven by steam. The commodities that are used to make this steam include gas, coal, oil and nuclear fuels.
As a result the cost of generating electricity is in a large part driven by the cost of the commodity used to power the generation.
The wider commodity market influences the price of these raw commodities, and a higher demand for limited supply will push the price of a certain commodity up, or divert investment to cheaper, alternative sources that in turn will place pressure on price.
However beyond the simple headline of supply and demand there are a host of other drivers influencing the cost of electricity.
In 2013/14 the UK fuel mix for electricity generation was:
Producing CO2 of 428g/kWh and High Level Radioactive Waste of 0.0017g/kWh
The traditional sources of electricity are Coal, Gas and Nuclear. In recent decades these have been supplemented by renewable generation sources such as: