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A coal plant and a natural gas plant have the following attributes: Coal Baseload Gas Baseload Capacity 1000 MW 1000 MW Fixed 0&M $3000/hr $1500/hr
A coal plant and a natural gas plant have the following attributes:
Coal Baseload Gas Baseload Capacity 1000 MW 1000 MW Fixed 0&M $3000/hr $1500/hr Variable 0&M $5/MWh $3/MWh Fuel Cost $3/MMBtu $? / MMBtu Heat Rate 10 MMBtu/MWh 7 MMBtu/MWh Emissions Rate 1.0 ton CO2/MWh 0.5 ton CO2/MWh Both plants are operating in an electricity market (uniform price auction) in which they are subject to a carbon tax of $20/ton of CO2. They both bid marginal cost (including the cost of carbon). What is the maximum natural gas price such that the Gas Baseload plant is dispatched before the Coal Baseload plant? (Assume if their bids are tied, the gas plant gets dispatched before the coal plant)Step by Step Solution
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