[MakersF]

Capital costs starting to dominate doesn't mean that they increase.

If capital costs are 10 and operating costs are 90, but later operating costs become 1, the capital costs remain 10 and the price to recover the capital costs is the same.

Of course the capital costs need to be spread over less kwh, so the kwh will become more expensive, but what matters is the avg (and thus total) cost paid, and that would be lower.

E.g.

5B in capital cost for 25MW (amortized in 25 years), and 30 per MWh in gas cost.

If you produce 180TWh (20h daily of production) the average price cost will be (5'000'000'000/25 + 180'000'000*30)/180'000'000 = 31 per mwh.

If you produce 36TWh (5h a day) the average cost is 35, but the total cost is significantly lower.

At the limit, if the power plant produces 1MWh in the whole year, it will cost 200'000, but paying that MWh that high enabled the system to pay for all the rest of the year the electricity at less than 31. You need to look at the total cost paid in the end by users, not at the marginal costs in some situations.