In the 1950 and early 60s Nuclear power plants were being built They used only a few lbs of uranium which seemed to mean almost no cost for fuel It was believed by many the electricity would be too cheap to meter In other words, they expected that you would pay a flat power fee every month to your electric company and then use whatever you needed (Like a cell phone with unlimited air time) Near Chicago a hypothetical utility named Take Your Wealth Edison aggressively began building nuclear plants Consider the case of a Take Your Wealth Edison engineer (Ned Milty) planning a 1000 megawatt power plant (1,000,000 kilowatt) Nerd believes the plant will cost $1,150 per kilowatt to build Consider that previous questions from this series have been answered, and the additional given information is the following 1 Plant Cost $1,150,000,000 2 Plant Cost at 80 $920,000,000 3 Investment Needed for Project $230,000,000 4 Annual Payment for Utilities at 3 5 Interest Over 30 Years $50,048,000 5 Power Generated Per Year 7,621,000,000 kilowatts 6 Annual Operating Cost at 0 3 Cents per Kilowatt Hour $22,863,600 1 Ned believes his plant will run for 50 years and that it will sell power for 2 cents kwh Draw the cash flow that Ned will project from the viewpoint of Take Your Wealth Edision investors 2 What is the IRR for the cash flow in the previous question If it helps, previous questions are numbered below THIS IS ALL THAT IS GIVEN 1 How much does Ned believe this plant will cost 2 Ned proposes to issue bonds to pay for 80 of the power plant How many dollars worth of bonds does Ned want to issue 3 How much money will Take Your Wealth Edison have to come up with 4 Ned expects to get low cost bonds at 3 5 interest over 30 years What will the Utilities annual payments be to retire the bonds 5 Ned expects to run the power plant at an 87 capacity factor How much power will the plant generate every year 6 Ned believes that the cost for running his nuke plant will be 0 3 cents per kilowatt hour What will Ned project for his annual operating cost for his Nuke plant

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In the 1950 and early 60s Nuclear power plants were being built. They used only a few lbs of uranium which seemed to mean almost

In the 1950 and early 60s Nuclear power plants were being built. They used only a few lbs of uranium which seemed to mean almost no cost for fuel. It was believed by many the electricity would be too cheap to meter. In other words, they expected that you would pay a flat power fee every month to your electric company and then use whatever you needed (Like a cell phone with unlimited air time) Near Chicago a hypothetical utility named Take Your Wealth Edison aggressively began building nuclear plants. Consider the case of a Take Your Wealth Edison engineer (Ned Milty) planning a 1000 megawatt power plant (1,000,000 kilowatt). Nerd believes the plant will cost $1,150 per kilowatt to build.

Consider that previous questions from this series have been answered, and the additional given information is the following:

1. Plant Cost	$1,150,000,000
2. Plant Cost at 80%	$920,000,000
3. Investment Needed for Project	$230,000,000
4. Annual Payment for Utilities at 3.5% Interest Over 30 Years	$50,048,000
5. Power Generated Per Year	7,621,000,000 kilowatts
6. Annual Operating Cost at 0.3 Cents per Kilowatt Hour	$22,863,600

1. Ned believes his plant will run for 50 years and that it will sell power for 2 cents/kwh. Draw the cash flow that Ned will project from the viewpoint of "Take Your Wealth Edision" investors.

2. What is the IRR for the cash flow in the previous question?

If it helps, previous questions are numbered below. THIS IS ALL THAT IS GIVEN.

1- How much does Ned believe this plant will cost?

2. Ned proposes to issue bonds to pay for 80% of the power plant. How many dollars worth of bonds does Ned want to issue?

3- How much money will Take Your Wealth Edison have to come up with?

4. Ned expects to get low cost bonds at 3.5% interest over 30 years. What will the Utilities annual payments be to retire the bonds?

5. Ned expects to run the power plant at an 87% capacity factor. How much power will the plant generate every year?

6. Ned believes that the cost for running his nuke plant will be 0.3 cents per kilowatt hour. What will Ned project for his annual operating cost for his Nuke plant?