A combined solar and auxiliary energy system is used to meet the same load as in Example
Question:
A combined solar and auxiliary energy system is used to meet the same load as in Example 12.5. The total cost of the system to cover 65% of the load (solar fraction) is $20,000. The owner will pay a down payment of 20% and the rest will be paid over a 20-year period at an interest rate of 7%. Fuel costs are expected to rise at 9% per year. The life of the system is considered to be 20 years, and at the end of this period, the system will be sold for 30% of its original value. In the first year, the extra maintenance, insurance, and parasitic energy costs are $120 and the extra property tax is $300; both are expected to increase by 5% per year. The general market discount rate is 8%. The extra property taxes and interest on the mortgage are deducted from the income tax, which is at a fixed rate of 30%. Find the present worth of the solar savings.
Data Analysis and Decision Making
ISBN: 978-0538476126
4th edition
Authors: Christian Albright, Wayne Winston, Christopher Zappe