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Calculating LCOE PROBLEM. An investor owned utility is choosing between a coal plant and a natural gas plant. The IOU can afford to build at
Calculating LCOE PROBLEM.
An investor owned utility is choosing between a coal plant and a natural gas plant. The IOU can afford to build at most one plant. Plant A has a capacity factor of 80% and a capacity of 900 MW. Plant B has a capacity factor of 70% and a capacity of 850 MW. There are no O & M costs. Which of the plants has lower LCOE? Assume an interest rate of 12% and that investment takes place up-front. Show all work, including any spreadsheets. LCOE = sigma^n_t = 0 (total cos t)t/(1 + r)/sigma^n_t = 0 (energygenerated)t/(1 + r)
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