HomeMy WebLinkAbout9 REF R8 Economic Evaluation ChangesREF R8: Change to Economic Evaluation
Base case changes
The base case is the power system that the proposed project will be replacing (in part), in rural
communities the base case is generally a diesel powerhouse. All of the benefits that are counted in the
economic model for proposed projects come from displacing fuel consumption in the base case system.
Operations and Maintenance (O&M) assumptions for the base case will be modified to include
both fixed and variable O&M costs to more accurately reflect the impact of renewable integration
on these costs in the existing system. The model currently assumes ties all O&M costs to kWhs
generated, disregarding costs associated with run time which may or may not be impacted by the
new project.
Replacement and repair (R&R) costs will be included for the base case. R&R costs such as major
overhauls and engine replacements will be programmed into the base case based on
manufacturer recommendations for each system.
Standard efficiency in the base case will be separated into large (more efficient) and small (less
efficient) systems. Currently all diesel systems are assumed to generate 13kwh/gallon, larger
systems should be getting closer to 14-15kwh/gallon.
Establish minimum genset loads for integration of wind/hydro/solar to provide a more realistic
picture of potential diesel displaced. Diesel generators have varying capacity to scale back without
losing efficiency, all diesel generators will lose efficiency at very low loads.
Loss of heat recovery currently in use will be assessed and integrated into evaluation of costs and
benefits. The benefits counted in the model are displaced fossil fuels to the community.
Railbelt base case will be upgraded based on more current information about the Railbelt system.
RPSU Powerhouse information
Where available RPSU powerhouse information will be used to assess the current system’s
capacity to integrate renewables. In situations where the current diesel system will not allow for
successful integration of renewables the applicant may be recommended for a grant conditional
on upgrade of the diesel system.
Installed cost assumptions will be updated (for recon and feasibility applications)
Wind: update Railbelt installed cost based on existing systems
Solar PV: use PV Watts estimator for cost/kWh
Integration
Cost of integration and analysis of impact on existing system will be required in evaluation of
construction applications.
Fuel price projections
The Alaska Center for Energy and Power (ACEP) will supply natural gas price projections.
Reporting requirements
Cost of instrumentation to collect and report data that is outside the scope of the renewable
generation project but required by AEA will not be included as a project cost in the economic
evaluation.