The change in cost associated with a unit change in quantity supplied or produced. The cost of providing an additional kilowatt-hour of energy output over and above any energy currently being produced. The energy industry refers to the next kilowatt-hour or next unit as the basis for determining this cost. Marginal costs only include immediate expenses required to produce more energy. Long run marginal cost includes capital costs and embedded costs which are not included in marginal costs. Marginal cost is often used interchangeably with incremental cost, but marginal cost can be applied to the average next-unit cost for a large number of additional units, whereas incremental cost applies strictly to the next unit, not to any average of multiple next-units