Wikipedia Deep Dive

Capacity factor

10 min read

The Number That Reveals Whether a Power Plant Is Actually Working

Here's a question that should bother you: if a power plant is rated at 1,000 megawatts, how much electricity does it actually produce? The answer is almost never 1,000 megawatts, and the gap between promise and reality tells us everything about the true economics of energy.

This gap has a name. It's called the capacity factor.

Think of it like a car's fuel efficiency rating. Your car might be capable of going 150 miles per hour, but that doesn't mean you'll average 150 miles per hour on your commute. The capacity factor measures what a power plant actually delivers compared to what it could theoretically deliver if it ran at full blast, every hour, every day, all year long.

The Simple Math Behind a Crucial Metric

The calculation is straightforward. Take the actual energy a plant produces over some period—usually a year—and divide it by the maximum energy it could have produced if it never stopped and never slowed down. Multiply by 100 to get a percentage.

A capacity factor of 50% means the plant produced half of what it theoretically could have. A capacity factor of 90% means it ran almost continuously at full power. A capacity factor of 25% means three-quarters of its potential went unused.

Why does this matter? Because when you're deciding whether to build a nuclear plant or a wind farm or a solar installation, the sticker price only tells part of the story. A 500-megawatt wind farm with a 35% capacity factor produces roughly the same amount of electricity as a 200-megawatt nuclear plant with a 90% capacity factor. The nameplate capacity—that big number politicians and press releases love to cite—can be deeply misleading.

Nuclear: The Marathon Runner

Nuclear power plants sit at the top of the capacity factor rankings, and it's not even close.

Consider Palo Verde Nuclear Generating Station in Arizona, the largest nuclear plant in the United States. Its three reactors have a combined nameplate capacity of 3,942 megawatts. In 2010, the plant generated 31.2 terawatt-hours of electricity. Run the math and you get a capacity factor of 90.4%.

That means Palo Verde was producing power at or near its full capability for more than 90% of the year. The remaining 10%? Mostly scheduled maintenance and refueling. Each reactor gets refueled every 18 months, and the plant staggers these outages so one reactor goes down each spring and one each fall. In 2014, the maintenance crew completed a refueling in just 28 days—a record for the facility.

But here's where it gets strange. In 2019, a reactor at Prairie Island nuclear plant in Minnesota achieved a capacity factor of 104.4%.

Wait. How can you produce more than 100% of your theoretical maximum?

The answer involves the quirks of how nameplate capacity is measured. A reactor's official rating is set conservatively, based on design specifications and safety margins. But in practice, with optimized operations and favorable conditions, reactors can sometimes exceed that rating slightly. It's like your car's speedometer being calibrated conservatively—you might actually be going 103 when it reads 100.

Wind: The Sprinter Who Takes Long Breaks

Wind power tells a different story. The wind doesn't blow constantly, and when it does blow, it doesn't always blow at the optimal speed.

Horns Rev 2, a Danish offshore wind farm in the North Sea, has a nameplate capacity of 209.3 megawatts. Over its first seven years of operation, it averaged 875 gigawatt-hours per year. That works out to a capacity factor of 47.7%—meaning it produced less than half of what it theoretically could have if the wind blew perfectly all year.

Is 48% good? For offshore wind, it's actually excellent. The North Sea is one of the windiest places on Earth for power generation. Onshore wind farms typically do worse.

Fosen Vind in Norway, a massive onshore project with 1,000 megawatts of capacity, was designed with an expected capacity factor of just 39%. In the United States, onshore wind farms averaged between 32% and 35% from 2013 through 2016.

But location changes everything. The Eolo wind farm in Nicaragua achieved a remarkable 60.2% capacity factor in 2015, thanks to the steady trade winds that sweep across Central America. Finland's wind farms see their capacity factors more than double during the cold winter months compared to July, which conveniently coincides with when Finns need the most electricity for heating.

One crucial clarification: the capacity factor has nothing to do with Betz's limit, a law of physics stating that no wind turbine can capture more than about 59% of the wind's kinetic energy. A capacity factor measures how often and how hard the turbine runs, not how efficiently it converts wind into electricity. You could have a perfectly efficient turbine sitting idle on a calm day—that's a capacity factor problem, not an efficiency problem.

Hydroelectric: The Elephant That Might Be Sleeping

Hydroelectric power presents perhaps the most counterintuitive capacity factors.

The Three Gorges Dam in China is the largest power station on Earth by installed capacity. Its 22,500 megawatts dwarf any nuclear plant, any coal plant, any other dam. In 2015, it generated 87 terawatt-hours of electricity—an enormous amount, enough to power tens of millions of homes.

Yet its capacity factor was only 45%.

How can the world's mightiest power plant operate at less than half its potential? Several reasons. Rivers don't flow at constant rates—seasonal variations in rainfall and snowmelt mean more water in some months, less in others. Operators must also balance electricity generation against flood control, irrigation, and downstream environmental needs. Sometimes they deliberately hold back water in the reservoir to save it for periods of higher demand.

Hoover Dam on the Colorado River shows even more dramatic variation. Its long-term average capacity factor is just 23%—less than a quarter of its theoretical maximum. But that average masks wild swings. In 1984, a wet year, Hoover Dam generated 10.3 terawatt-hours. In 1956, during drought conditions, it produced only 2.6 terawatt-hours. Same dam, same turbines, vastly different output.

This illustrates an important point: low capacity factor doesn't necessarily mean poor performance. It might mean the plant is being operated strategically, saving its fuel—water, in this case—for when it's most valuable. A dam that ran at 100% capacity would empty its reservoir and have nothing left for summer peak demand or drought years.

Solar: Waiting for the Sun

Solar power faces an obvious constraint that no amount of engineering can overcome: the sun sets.

Even on a perfectly clear day at the best location on Earth, a solar panel produces nothing for roughly half the day. Add in clouds, dust, morning and evening angles, and seasonal variations, and capacity factors drop further still.

The Agua Caliente Solar Project in Arizona sits near the 33rd parallel, in one of the sunniest regions of North America. Its 290 megawatts of capacity produce an average of 740 gigawatt-hours per year—a capacity factor of 29.1%.

That might sound low, but for solar it's actually quite good. Arizona's clear skies and intense sun make it among the best solar locations in the developed world.

Now compare that to Lauingen Energy Park in Bavaria, Germany, near the 49th parallel. Same technology, radically different result. With a capacity factor of just 12%, this German solar farm produces less than half as much electricity per installed megawatt as its Arizona cousin. The difference? Bavaria is cloudier, further from the equator, and has shorter winter days. The sun simply delivers less energy to panels at that latitude.

Temperature matters too, in a surprising way. Solar panels actually work better when they're cold. Their efficiency drops as they heat up. This creates a strange tradeoff: the places with the most sun are often hot enough to reduce panel performance, while cooler locations with less sun might get better efficiency from each ray that does arrive.

Why Plants Don't Run at Full Power

The gap between nameplate capacity and actual production comes from three distinct sources, and understanding them reveals how electricity grids actually work.

First, mechanical reality. Equipment breaks. Parts wear out. Reactors need refueling. Turbines need maintenance. Even the most reliable power plant will spend some time offline for repairs and upkeep. This unavoidable downtime is called the availability factor—the percentage of time the plant is physically capable of operating. A plant's capacity factor can never exceed its availability factor. If a plant is shut down for maintenance 10% of the year, its capacity factor cannot exceed 90%, no matter how well it runs when operating.

Nuclear plants, with their high availability factors and steady output, excel at minimizing this source of lost capacity. Their equipment is designed for continuous operation, and utilities invest heavily in keeping it running.

Second, economic dispatch. Just because a plant can run doesn't mean it should. Electricity prices fluctuate constantly. Natural gas prices rise and fall. When prices drop too low, some plants lose money on every megawatt-hour they produce. Operators may intentionally idle these plants, waiting for more favorable market conditions.

This particularly affects peaking power plants—facilities designed to run only during periods of highest demand, when prices spike. A natural gas peaker might operate just a few hundred hours per year, giving it a capacity factor in the single digits. This isn't poor performance; it's the business model. These plants earn money precisely because they're available when nobody else is, commanding premium prices during those critical hours.

Third, resource availability. You cannot run a coal plant without coal, a gas plant without gas, or a solar panel without sunlight. For fossil fuel plants, this constraint usually means maintaining adequate fuel supplies—a logistical challenge but a solvable one. For renewable sources, it means accepting that nature sets the schedule.

A solar panel cannot choose to operate at night. A wind turbine cannot summon wind. A hydroelectric dam cannot create water from nothing during a drought. These plants must take what nature provides, which explains why their capacity factors tend to be lower and more variable than those of plants that burn stored fuel on demand.

What the Numbers Actually Mean for Energy Policy

When politicians announce plans to add 10,000 megawatts of solar capacity, they're using the nameplate number—the theoretical maximum. The actual electricity that capacity will produce depends entirely on where those panels are installed and what capacity factor they achieve.

Ten thousand megawatts of solar in Arizona at a 29% capacity factor produces about the same electricity as 3,200 megawatts of nuclear at 90% capacity factor. Both would generate roughly 25 terawatt-hours per year. But the solar installation requires three times as many megawatts on paper to deliver the same electrons in practice.

This isn't an argument for or against any particular technology. It's an argument for clarity. The capacity factor strips away the marketing and reveals what a power source actually delivers. And in a world racing to decarbonize while keeping the lights on, understanding what our investments actually produce has never been more important.

The nameplate capacity is the promise. The capacity factor is the truth.