Question
Find the levelized cost of electricity in $/kWh for a new natural gas fired power plant that has an initial capital cost of $700 million,
Find the levelized cost of electricity in $/kWh for a new natural gas fired power plant that has an initial capital cost of $700 million, an expected lifetime of 35 years, and will produce 1.2 billion kWh/year of electricity. Assume there will be no salvage value or decommissioning costs. Total operating costs are $20 million per year. The power plant developer needs a 12% rate of return to cover financing costs and the expected profit on the investment. How does the LCOE compare to representative LCOE values for electricity from wind or solar?
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