Project Finance Models for Power Plants with Carbon Credits under CDM (download file)
Project Finance Models for Power Plants with Carbon Credits under CDM (download file)
This advanced model allows you to perform the following:
1) Determine the impact of electricity tariff (selling price) on NPV, IRR and payback given the capital cost, fuel cost and O&M cost.
2) Determine the maximum main fuel price (natural gas, gas oil) to meet IRR given electricity tariff, capital cost and O&M cost.
3) Determine the maximum capital cost (all-in) to meet IRR given electricity tariff, fuel price and O&M cost.
4) Perform sensitivity analysis (+/- 10% change) on variables such as electricity tariff, rated capacity, plant heat rate (efficiency), fuel cost, capital cost and O&M costs on IRR.
5) The IRR may be defined as DCF-ROI (project cost vs cash flow), DCF-ROE (equity portion of project cost vs cash flow), DCF-FC (equity portion vs free cashflow), and discounted DCF-FC (native currency is depreciating vs foreign currency). The model provides for analysis with escalation (nominal IRR) and without escalation (real IRR).
6) When applied to large scale power plants, it could optimize the type of CCGT engine/manufacturer, plant location and cooling system (once thru sea water, once thru lake water, river cooling tower, deep well cooling tower, radiator cooling) and transmission line system (type of conductor). The optimal configuration is determined by the combination that provides the cheapest electricity tariff, cheapest fuel or highest IRR.
The model includes capacity degradation, plant heat rate degradation and overhaul and maintenance cycle to determine dependable capacity, actual plant efficiency and actual plant operating hours (to determine availability and capacity factor).
The user may specify the type of system of units and currency (e.g. Peso, US$, MW, MWh, MMBtu or GJ, liters or gallons, kg or lb).
Be one of the many satisfied users of the new top-down style project finance models (minimal tabs) that allow you full control on your financial models and do all your sensitivities (tariff, demand, capex, fuel, opex, etc.). If you believe you deserve this model, email me your particular concerns, and hopefully, allow me to address your needs.
Hit the road running with my project finance models. Using a top-to-bottom approach, update the data as you go down the model and understanding it fully at the same time. The user has full control – can add rows and columns as necessary. Once you have set-up your financial model, do your sensitivity runs, then write your final feasibility study report, including the executive summary and appendices. I can provide you template financial models and sample feasibility studies to guide you – to speedup your work.
To place an order, email me to this address your specific needs. If you have a PayPal account, then click the DONATE button in order to transfer payment to my PayPal account using the link below at the right hand side of the screen of my website:
http://energytechnologyexpert.com/
then click the DONATE button.
Once I have received email confirmation from PayPal that a payment has been completed and I received your order from my email address:
or
I will then send via email your desired project finance model.
In the absence of PayPal account or if PayPal is not present in your country, you may apply for telegraphic transfer from a US Major Bank such as Citi Bank or Chase Manhattan Bank in your country to remit the payment to my local bank in the Philippines. I will provide you my bank details once you have a firm order via email, similar to what I did for my clients from Africa (SI units) and America (English & NYMEX units).
Please refer to download file for sample data inputs and instructions for using the project finance model.
Regards,
Marcial T. Ocampo
Energy Technology & Pricing Expert
Project Finance & Financial Modeling
Energy & Business Development Consultant
—————- sample input data and instruction for running the project finance model
| Instructions for Running this Project Finance Model (by Marcial T. Ocampo) |
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| Enter the required data starting from the first step to the last step, then converge the model by pressing ctrl + d |
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| 0) |
0 |
Include Carbon Emission Credits (CDM) |
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Blue cells are input fields for updating |
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These cells are case switches |
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| 1) |
2 |
Define the NPV and return IRR to be used (1-4). |
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0 |
NPV-ROI | return on investment (100% equity, 0% debt) – project cost versus cash flow (need to set equity to 0%) |
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1 |
NPV-ROE | return on equity (say 30% equity, 70% debt) – equity portion of project cost versus cash flow (default) |
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0 |
NPV-FC | return on equity (say 30% equity, 70% debt) – equity portion of project cost versus dividends flow (no depreciation) |
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0 |
NPV-FC discounted | return on equity (say 30% equity, 70% debt) – equity portion of project cost versus discounted dividends flow (depreciating currency) |
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| 2) |
25 |
Define the operating period (25 to 30 years) for the CCGT. | This model is for 25 years but user may insert additional columns or delete columns to match period with project life. |
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2009 |
Define the end of construction period (year 0). | It assumes everything has been constructed and finished at the end of this year (0) and will operate on following year (1). |
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| 3) |
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If you need to insert columns (increase operating period from 25 to say 30 years), place cursor at cell AA1 |
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in both Main and Reports worksheet, then highlight to the right the number of columns to add, then insert columns. |
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Then copy the entire column range (AA10 .. AA615) in Main worksheet (the model sheet) up to the 2nd to the last column (say year 29) |
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Then copy the entire column range (AA1 .. AA277) in Reports worksheet (the report sheet) up to the 2nd to the last column (say year 29) |
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Be careful in copying the columns. You must preserve the overhaul cycle for the overhaul and regular maintenance activities (rows 34 to 35) of Main worksheet. |
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Define overhaul cycle and capacity degradation |
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1.00% |
Normal, % p.a. | normal degradation rate |
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-4.00% |
Overhaul, % p.a. | degradation recovered after overhaul |
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5 |
Overhaul Cycle, yr | overhaul cycle |
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80.00% |
Recovery, % | fraction of normal degradation recovered during overhaul |
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6 |
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per unit |
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5 |
Select engine model & manufacturer (1-6) |
MW gross |
own use(1) |
MW net |
Heat Rate, kJ / kWh |
Efficiency, % |
Cost, $/kW |
Variable O&M |
Fixed O&M |
MW gross |
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0 |
SGT6-5000F (Siemens Westinghouse) |
264.061 |
1.457 |
262.604 |
6,611 |
54.45% |
831.46 |
0.00200 |
0.150 |
264.061 |
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GE PG 7121 EA x 2 (General Electric) |
238.615 |
1.316 |
237.299 |
7,162 |
50.27% |
975.61 |
0.00200 |
0.150 |
238.615 |
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GE PG 7241 FA (General Electric) |
236.292 |
1.303 |
234.989 |
6,576 |
54.74% |
823.53 |
0.00200 |
0.150 |
236.292 |
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0 |
SGT6-4000F (Siemens Westinghouse) |
238.839 |
1.318 |
237.521 |
6,473 |
55.62% |
832.02 |
0.00200 |
0.150 |
238.839 |
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1 |
MHI501F3 (Mitsubishi Heavy Industries) |
252.976 |
1.396 |
251.580 |
6,560 |
54.88% |
801.59 |
0.00200 |
0.150 |
252.976 |
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0 |
GT11N2 (Alstom) |
321.048 |
1.771 |
319.277 |
7,115 |
50.60% |
907.75 |
0.00200 |
0.150 |
321.048 |
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Used |
MHI501F3 (Mitsubishi Heavy Industries) |
252.976 |
1.396 |
251.580 |
6,560 |
54.88% |
801.59 |
0.00200 |
0.150 |
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(1) Own use is mainly condenser cooling pumping power |
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| 6) |
2 |
Select plant location / method of cooling of condenser (1-5) |
Length, m |
Head, m |
Temp rise, deg C |
Flow, m3/hr |
kW Power(2) |
% of Gross Power |
Cost, $(3) |
cooling medium flow rate | |
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0 |
Once thru sea water |
2,000.00 |
31.50 |
3.00 |
42,676 |
2,930.57 |
1.158% |
7,439,378 |
sea water (m3/hr) | |
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Once thru lake water |
400.00 |
15.00 |
3.00 |
42,676 |
1,395.51 |
0.552% |
7,397,716 |
lake water (m3/hr) | |
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River water cooling tower |
2,000.00 |
30.00 |
10.00 |
12,803 |
837.31 |
0.331% |
7,332,480 |
river water (m3/hr) | |
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0 |
Deep well water cooling tower |
1,000.00 |
60.00 |
10.00 |
12,803 |
1,674.61 |
0.662% |
14,664,961 |
deep well (m3/hr) | |
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Radiator cooling |
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13.00 |
25,324 |
7,837.50 |
3.098% |
8,792,214 |
ambient air (MT/hr) | |
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Used |
Once thru lake water |
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1,395.51 |
0.552% |
7,397,716 |
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(2) Power = 9.81 x (Q/3600) x H x 80% | (3) Cost estimate of piping, pump, treatment, etc. | ||||
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| 7) |
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Once thru cooling (sea water, lake water) |
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252.976 |
MWh / h |
168.651 |
Heat to Boiler (2/3) since (1/3) goes to gas turbine |
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307 |
MWh / h |
54.9% |
Overall Fuel to Electricity Efficiency |
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fuel to electricity |
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307,319 |
kWh / h |
1,000 |
kWh / MWh |
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1,106,348,373 |
kJ / h |
3,600 |
kJ / kWh |
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1,048,611,807 |
BTU / h |
1.05506 |
kJ / BTU |
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Energy input from fuel |
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891,320,036 |
BTU / h |
85% |
Boiler Efficiency |
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Energy to steam |
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157,291,771 |
BTU / h |
15% |
Heat Losses to Atmosphere |
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Energy to atmosphere & losses |
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891,320,036 |
BTU / h |
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Energy input to steam turbine |
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356,528,014 |
BTU / h |
40% |
Rankin Steam Turbine Efficiency |
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Energy to drive shaft |
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534,792,022 |
BTU / h |
60% |
Heat Losses to Condenser |
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Energy to condenser / cooling tower |
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356,528,014 |
BTU / h |
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Energy input to drive shaft |
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345,903,480 |
BTU / h |
97% |
Mechanical Drive (99%) & Generator Efficiency (98%) | Energy to electricity |
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10,624,535 |
BTU / h |
3% |
Heat Losses to Generator |
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Energy to generator losses |
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534,792,022 |
BTU / h |
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Energy input to condenser / cooling tower |
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508,052,421 |
BTU / h |
95% |
Heat transferred to cooling water |
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Energy to cooling water |
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26,739,601 |
BTU / h |
5% |
Heat Losses to Atmosphere |
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Energy to atmosphere & losses |
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3.0 |
Allowable temperature Rise, deg C |
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Water allowable temperature rise |
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1.8 |
deg F per deg C rise |
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5.4 |
Allowable temperature Rise, deg F |
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1.00 |
Specific heat of lake water, Btu / lb deg F | Water specific heat |
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94,083,782 |
lb / h |
5.4 |
Allowable Btu / lb |
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42,676,123 |
kg / h |
2.2046 |
lb / kg |
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42,676 |
cum / h |
1,000 |
kg / cubic meter (kg / cum) |
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Cooling Water |
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| 8) |
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Water cooling tower (river water, deep well) |
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252.976 |
MWh / h |
168.651 |
Heat to Boiler (2/3) since (1/3) goes to gas turbine |
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307 |
MWh / h |
54.9% |
Overall Fuel to Electricity Efficiency |
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fuel to electricity |
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307,319 |
kWh / h |
1,000 |
kWh / MWh |
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1,106,348,373 |
kJ / h |
3,600 |
kJ / kWh |
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1,048,611,807 |
BTU / h |
1.05506 |
kJ / BTU |
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Energy input from fuel |
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891,320,036 |
BTU / h |
85% |
Boiler Efficiency |
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Energy to steam |
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157,291,771 |
BTU / h |
15% |
Heat Losses to Atmosphere |
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Energy to atmosphere & losses |
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891,320,036 |
BTU / h |
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Energy input to steam turbine |
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356,528,014 |
BTU / h |
40% |
Rankin Steam Turbine Efficiency |
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Energy to drive shaft |
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534,792,022 |
BTU / h |
60% |
Heat Losses to Condenser |
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Energy to condenser / cooling tower |
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356,528,014 |
BTU / h |
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Energy input to drive shaft |
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345,903,480 |
BTU / h |
97% |
Mechanical Drive (99%) & Generator Efficiency (98%) | Energy to electricity |
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10,624,535 |
BTU / h |
3% |
Heat Losses to Generator |
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Energy to generator losses |
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534,792,022 |
BTU / h |
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Energy input to condenser / cooling tower |
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508,052,421 |
BTU / h |
95% |
Heat transferred to cooling water |
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Energy to cooling water |
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26,739,601 |
BTU / h |
5% |
Heat Losses to Atmosphere |
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Energy to atmosphere & losses |
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10.0 |
Allowable temperature Rise, deg C |
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Water allowable temperature rise |
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1.8 |
deg F per deg C rise |
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18 |
Allowable temperature Rise, deg F |
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1.00 |
Specific heat of lake water, Btu / lb deg F | Water specific heat |
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28,225,134 |
lb / h |
18 |
Allowable Btu / lb |
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12,802,837 |
kg / h |
2.2046 |
lb / kg |
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12,803 |
cum / h |
1,000 |
kg / cubic meter (kg / cum) |
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Cooling Water |
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| 9) |
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Radiator cooling (ambient air) |
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252.976 |
MWh / h |
168.651 |
Heat to Boiler (2/3) since (1/3) goes to gas turbine |
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307 |
MWh / h |
54.9% |
Overall Fuel to Electricity Efficiency |
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fuel to electricity |
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307,319 |
kWh / h |
1,000 |
kWh / MWh |
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1,106,348,373 |
kJ / h |
3,600 |
kJ / kWh |
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1,048,611,807 |
BTU / h |
1.05506 |
kJ / BTU |
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Energy input from fuel |
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891,320,036 |
BTU / h |
85% |
Boiler Efficiency |
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Energy to steam |
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157,291,771 |
BTU / h |
15% |
Heat Losses to Atmosphere |
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Energy to atmosphere & losses |
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891,320,036 |
BTU / h |
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Energy input to steam turbine |
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356,528,014 |
BTU / h |
40% |
Rankin Steam Turbine Efficiency |
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Energy to drive shaft |
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534,792,022 |
BTU / h |
60% |
Heat Losses to Condenser |
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Energy to condenser / cooling tower |
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356,528,014 |
BTU / h |
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Energy input to drive shaft |
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345,903,480 |
BTU / h |
97% |
Mechanical Drive (99%) & Generator Efficiency (98%) | Energy to electricity |
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10,624,535 |
BTU / h |
3% |
Heat Losses to Generator |
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Energy to generator losses |
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534,792,022 |
BTU / h |
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Energy input to condenser / cooling tower |
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508,052,421 |
BTU / h |
95% |
Heat transferred to cooling air |
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Energy to cooling water |
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26,739,601 |
BTU / h |
5% |
Heat Losses to Atmosphere |
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Energy to atmosphere & losses |
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13.0 |
Allowable temperature Rise, deg C (10 TO 16) | Allowable ambient air temperature rise |
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1.8 |
deg F per deg C rise |
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23.4 |
Allowable temperature Rise, deg F |
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0.389 |
Specific heat of air, Btu / lb deg F = 7/18 | Ambient Air specific heat |
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55,829,936 |
lb / h |
9.1 |
Allowable Btu / lb |
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25,324,293 |
kg / h |
2.2046 |
lb / kg |
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25,324 |
MT / h |
1,000 |
kg / MT |
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Cooling Ambient Air |
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| 10) |
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Define overhaul, maintenance, shutdown and outages |
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35 |
Planned Overhaul, days (5 wks) |
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21 |
Regular Maintenance, days (3 wks) |
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0.10% |
Economic S/D, % of CD |
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0.50% |
Deactivated S/D – External, % of CD |
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5.00% |
Forced Outage – Internal, % of CD |
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95.00% |
Load Factor, % of DC |
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| 11) |
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Define overhaul cycle and heat rate degradation |
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1.00% |
Normal, % p.a. | normal degradation rate |
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|
|
|
-4.00% |
Overhaul, % p.a. | degradation recovered after overhaul |
|
|
|
|
|
|
||
|
|
5 |
Overhaul Cycle, yr | overhaul cycle |
|
|
|
|
|
|
|
|
|
|
80.00% |
Recovery, % | fraction of normal degradation recovered during overhaul |
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
| 12) |
|
Define transmission line (T/L) system and cost |
|
Sea water |
Lake water |
River Water |
Deep Well |
Radiator |
Selected |
|
|
|
|
|
Line Voltage |
kV |
230 |
230 |
230 |
230 |
230 |
230 |
|
|
|
|
|
Power |
kW |
251,580 |
251,580 |
251,580 |
251,580 |
251,580 |
251,580 |
|
|
|
|
|
Length |
km |
20.00 |
10.00 |
15.00 |
15.00 |
25.00 |
10.00 |
1.609 |
km / mile |
|
|
|
Power Factor |
lag |
0.85 |
0.85 |
0.85 |
0.85 |
0.85 |
0.85 |
|
|
|
|
|
Cost per kilometer of T/L |
$/km |
$360,000 |
$396,000 |
$432,000 |
$432,000 |
$324,000 |
$396,000 |
|
|
|
|
4 |
Conductor type (1-4) |
|
Seaside City |
Lakeside City |
Riverside City |
Riverside City |
Inland City |
|
|
|
|
|
|
ACSR (MCM) |
|
% T/L Loss |
% T/L Loss |
% T/L Loss |
% T/L Loss |
% T/L Loss |
Selected |
|
|
|
|
1 |
ACSR (MCM) 336 |
|
2.477% |
1.238% |
1.858% |
1.858% |
3.096% |
1.238% |
|
|
|
|
2 |
ACSR (MCM) 795 |
|
1.185% |
0.593% |
0.889% |
0.889% |
1.482% |
0.593% |
|
|
|
|
|
AAC (MCM) |
|
|
|
|
|
|
0.000% |
|
|
|
|
3 |
AAC (MCM) 336 |
|
2.419% |
1.210% |
1.814% |
1.814% |
3.024% |
1.210% |
|
|
|
|
4 |
AAC (MCM) 789 |
|
1.030% |
0.515% |
0.773% |
0.773% |
1.288% |
0.515% |
|
|
|
|
Used |
AAC (MCM) 789 |
|
1.030% |
0.515% |
0.773% |
0.773% |
1.288% |
0.515% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 13) |
|
Define other power losses |
|
|
|
|
|
|
|
|
|
|
|
1.00% |
Step-up Transformer Loss (Switchyard), MWh |
|
|
|
|
|
|
|
|
|
|
|
0.00% |
Other Losses (non-technical, pilferage), MWh |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 14) |
|
Define fuel properties |
GHV, Btu/lb |
NHV, Btu/lb |
GHV / NHV |
kg / Liter |
Btu/liter |
Reference |
$/MMBtu |
PhP / liter 2009 |
|
|
|
95.00% |
Natural Gas (Malampaya Gas) – main fuel |
22,129 |
20,249 |
1.093 |
2009 |
$GJ |
8.628 |
9.10 |
418.11 |
PhP/GJ |
|
|
5.00% |
Diesel Oil – backup fuel (gas pipeline downtime) |
19,650 |
18,453 |
1.065 |
0.8448 |
36,597 |
46.44 |
16.92 |
30.00 |
PhP/liter |
|
|
4.00% |
Low Sulfur Fuel Oil (LSFO – 1% S) – boiler fuel |
18,400 |
17,449 |
1.055 |
0.9659 |
39,181 |
35.97 |
12.24 |
23.24 |
PhP/liter |
|
|
1.00% |
Bunker Fuel Oil (BFO – 3% S) – boiler fuel |
19,670 |
18,565 |
1.060 |
0.8916 |
38,664 |
34.84 |
12.01 |
22.51 |
PhP/liter |
|
|
|
Lube Oil |
|
|
|
0.8500 |
|
232.00 |
|
149.87 |
PhP/liter |
|
|
|
|
|
|
|
2.2046 |
lb/kg |
|
1.05506 |
kJ/Btu |
|
| 15) |
|
Lube Oil Consumption |
|
|
|
|
|
|
|
|
|
|
|
1.00% |
Normal, % p.a. | normal degradation rate |
|
|
|
|
|
|
|
|
|
|
-4.00% |
Overhaul, % p.a. | degradation recovered after overhaul |
|
|
|
|
|
|
||
|
|
5 |
Overhaul Cycle, yr | overhaul cycle |
|
|
|
|
|
|
|
|
|
|
80.00% |
Recovery, % | fraction of normal degradation recovered during overhaul |
|
|
|
|
|
|||
|
|
0.254 |
Ideal Lube Oil Consumption, g/kWh |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 16) |
0 |
Escalate fuel, lubes, tariff and O&M costs? (1=yes, 0=no) |
Used |
|
|
|
|
|
|
|
|
|
|
3.00% |
Natural Gas (Malampaya Gas) – main fuel |
0.00% |
|
|
|
|
|
|
|
|
|
|
3.50% |
Diesel Oil – backup fuel (gas pipeline downtime) |
0.00% |
|
|
|
|
|
|
|
|
|
|
2.50% |
Low Sulfur Fuel Oil (LSFO – 1% S) – boiler fuel |
0.00% |
|
|
|
|
|
|
|
|
|
|
2.00% |
Bunker Fuel Oil (BFO – 3% S) – boiler fuel |
0.00% |
|
|
|
|
|
|
|
|
|
|
5.00% |
Lube Oil |
0.00% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 17) |
|
Escalation rates for tariff and O&M costs |
Used |
|
(e.g. US) |
|
|
|
|
|
|
|
|
5.00% |
Annual increase of the tariff, % p.a. |
0.00% |
Foreign (US) |
US CPI |
Local (RP) |
RP CPI |
% of operating income | Calculated | Paul Breeze | |
|
|
3.25% |
Purchase of chemical materials |
0.00% |
70.00% |
2.50% |
30.00% |
5.00% |
0.40% |
variable O&M |
|
|
|
|
3.25% |
Utilities (electricity, water) |
0.00% |
70.00% |
2.50% |
30.00% |
5.00% |
0.25% |
variable O&M |
0.00205 |
0.00200 |
|
|
4.25% |
Maintenance of the installation |
0.00% |
30.00% |
2.50% |
70.00% |
5.00% |
5.000% |
fixed O&M |
|
|
|
|
4.25% |
Personnel expense |
0.00% |
30.00% |
2.50% |
70.00% |
5.00% |
4.000% |
fixed O&M |
|
|
|
|
4.25% |
Land lease, rent |
0.00% |
30.00% |
2.50% |
70.00% |
5.00% |
3.800% |
fixed O&M |
|
|
|
|
4.25% |
Other services |
0.00% |
30.00% |
2.50% |
70.00% |
5.00% |
3.000% |
fixed O&M |
0.1514 |
0.1500 |
|
|
5.00% |
Taxes, Insurances, Benefits & Regulatory Costs |
0.00% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 18) |
|
Define electricity sales & revenues |
Factor |
Adjustment |
|
|
|
|
|
|
|
|
|
70.00% |
Electricity sales to DU, MWh |
1.000 |
0.00% |
discount price to direct customers (e.g. -10%) |
|
|
|
|
||
|
|
20.00% |
Electricity sales to NPC, MWh |
1.000 |
0.00% |
reference price to national grid (e.g. 0%) |
|
|
|
|
||
|
|
10.00% |
Electricity sales to WESM, MWh |
1.000 |
0.00% |
wholesale spot market price (e.g. +15%) |
|
|
|
|
||
|
|
100.00% |
Total must add to 100% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 19) |
|
Define working capital for initial project cost (months) |
$/year |
Working Capital |
|
|
|
|
|
|
|
|
|
2 |
Total Fuel Costs |
5,649,906 |
941,651 |
|
|
|
|
|
|
|
|
|
2 |
Expenses from lube purchase |
82,955 |
13,826 |
|
|
|
|
|
|
|
|
|
2 |
Purchase of chemical materials |
48,526 |
8,088 |
|
|
|
|
|
|
|
|
|
2 |
Utilities (electricity, water) |
30,329 |
5,055 |
|
|
|
|
|
|
|
|
|
2 |
DOE 1-04 (0.01 PhP/kWh sold) |
18,098 |
3,016 |
0.01 |
DOE 1-94 impost per kWh sold |
|
|
|
|
|
|
|
2 |
Maintenance of the installation |
606,576 |
101,096 |
48.46 |
PhP/US$ exchange rate |
|
|
|
|
|
|
|
2 |
Personnel expense |
485,260 |
80,877 |
|
|
|
|
|
|
|
|
|
2 |
Land lease, rent |
460,997 |
76,833 |
|
|
|
|
|
|
|
|
|
2 |
Other services |
363,945 |
60,658 |
|
|
|
|
|
|
|
|
|
|
Total working capital |
7,746,593 |
1,291,099 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 20) |
|
Define corporate income tax rate and income tax holiday |
|
|
|
|
|
|
|
|
|
|
|
30% |
Corporate income tax rate (% of taxable income) |
|
|
|
|
|
|
|
|
|
|
|
0 |
Income tax holiday (ITH), years |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 21) |
|
Expenses not eligible for income tax deduction |
|
|
sample data |
|
|
|
|
|
|
|
|
0.00% |
Profit Sharing | of income after tax |
5.00% |
|
|
|
|
|
|
|
|
|
0 |
Social Benefit Fund – Host Community | per month |
|
10,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 22) |
|
Calculation of Working Capital Needs (WCN) |
|
|
|
|
|
|
|
|
|
|
|
3.00 |
Cash needed for operations (+) | months of expenses |
|
|
|
|
|
|
|
|
|
|
1.00 |
Customers / Receivables (+) | months of revenue |
|
|
|
|
|
|
|
|
|
|
2.00 |
Stocks / Inventory (+) | months of fuel & chemicals |
|
|
|
|
|
|
|
|
|
|
1.00 |
Suppliers / Payables (-) | months of payables |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 23) |
|
Estimate all-in capital cost |
|
|
|
000 PhP |
|
check variance |
|
|
|
|
|
|
Initial investment in land (US$/ha), 1 ha = 10,000 m2 |
1,000,000.00 |
10 |
ha |
10,000 |
|
- |
|
|
|
|
|
|
Freight on Board = FOB USA = $/kW |
38,845.05 |
252.976 |
MW |
9,826,866 |
|
- |
|
|
|
|
|
|
Ocean Freight = FRT = 5% x FOB |
5% |
|
|
491,343 |
|
- |
|
|
|
|
|
|
Insurance = INS = 1% x FOB |
1% |
|
|
98,269 |
|
- |
|
|
|
|
|
|
Cargo, Insurance & Freight = CIF = FOB + FRT + INS |
|
|
|
10,416,478 |
|
- |
|
|
|
|
|
|
Value Added Tax = VAT = 12% x CIF |
12% |
|
|
1,249,977 |
|
- |
|
|
|
|
|
|
Customs Duty = (CIF + VAT) x (% Duty) x (1 + % VAT) |
3% |
|
|
391,993 |
|
- |
|
|
|
|
|
|
Duty-Paid Landed Cost = DPLC = CIF + VAT + Duty |
|
|
|
12,058,448 |
|
- |
|
|
|
|
|
|
Local Freight Cost = LFC = 3% x CIF |
3% |
|
|
312,494 |
|
- |
|
|
|
|
|
|
Delivered Cost at Site = DCS = DPLC + LFC |
|
|
|
12,370,942 |
|
- |
|
|
|
|
|
|
Installation Cost = IC = 5% x FOB |
5% |
|
|
491,343 |
|
- |
|
|
|
|
|
|
Condenser Cooling System |
358,493,317 |
|
|
358,493 |
|
- |
|
|
|
|
|
|
Transmission Line, $ per km and km length |
19,190,160 |
10.00 |
km |
191,902 |
|
- |
|
|
|
|
|
|
Total EPC = DCS + IC+ CCS + T/L |
|
|
|
13,412,680 |
|
- |
|
|
|
|
|
|
Contingency (10%) = EPC x 10% |
10% |
|
|
1,341,268 |
|
- |
|
|
|
|
|
|
Documentary Stamps (1%) = EPC x 1% = DS |
1% |
|
|
134,127 |
|
- |
|
|
|
|
|
|
Total Fixed Assets (EPC + Contingency + DS) |
|
|
|
14,888,075 |
|
- |
|
|
|
|
|
|
Depreciation term (years) |
salvage |
10.00% |
535,971 |
25 |
14,898,075 |
- |
|
|
|
|
|
|
Development costs (modeler) |
|
1.00% |
|
148,981 |
|
- |
|
|
|
|
|
|
Other Costs including taxes, contingencies |
|
12.00% |
|
1,787,769 |
|
- |
|
|
|
|
|
|
Carbon Emission Registration & Consultancy |
|
|
|
- |
|
- |
|
|
|
|
|
|
Initial investment in capitalized expenses |
|
|
|
3,761,849 |
1,936,750 |
- |
|
|
|
|
|
|
Amortization term (years) |
salvage |
10.00% |
135,427 |
25 |
|
- |
|
|
|
|
|
|
Working Capital: |
|
|
|
|
|
- |
|
|
|
|
|
|
Working capital (adjustments for DSCR = 1.1) |
|
1.095 |
|
534,000 |
|
- |
|
|
|
|
|
|
Working capital (initial stocks – fuel) – 2 months |
|
|
|
941,651 |
|
- |
|
|
|
|
|
|
Working capital (initial stocks – lubes) – 2 months |
|
|
|
13,826 |
|
- |
|
|
|
|
|
|
Working capital (initial stocks – chemical materials) – 2 months |
|
|
8,088 |
|
- |
|
|
|
|
|
|
|
Working capital (mobilization – utilities) – 2 months |
|
|
|
5,055 |
|
- |
|
|
|
|
|
|
Working capital (mobilization – DOE 1-94) – 2 months |
|
|
|
3,016 |
|
- |
|
|
|
|
|
|
Working capital (mobilization – maintenance) – 2 months |
|
|
|
101,096 |
|
- |
|
|
|
|
|
|
Working capital (mobilization – personnel expense) – 2 months |
|
|
80,877 |
|
- |
|
|
|
|
|
|
|
Working capital (pre-paid expense – advance rent) – 2 months |
|
|
76,833 |
|
- |
|
|
|
|
|
|
|
Working capital (pre-paid expense – other services) – 2 months |
|
1,825,099 |
60,658 |
18,659,924 |
- |
|
|
|
|
|
|
|
Interest During Construction: |
|
|
|
|
|
- |
|
|
|
|
|
|
Dev’t fees (loan arranger) |
|
1.00% |
|
186,599 |
|
- |
Year -2 |
Year -1 |
Year 0 |
|
|
|
Front end fees (loan arranger) |
|
1.00% |
|
186,599 |
|
- |
33.0% |
33.0% |
34.0% |
|
|
|
Commitment fees (bank) |
|
0.50% |
|
94,233 |
|
- |
6,157,775 |
6,157,775 |
6,344,374 |
|
|
|
Interest During Construction (bank) – 36 months |
3.00 |
12.00% |
|
4,455,990 |
4,923,421 |
- |
6,157,775 |
12,315,550 |
18,659,924 |
|
|
|
Amortization term (years) |
salvage |
10.00% |
177,243 |
25 |
|
- |
62,511 |
31,722 |
0 |
|
|
Capital |
Total Investment (land, fixed, capitalized expenses, working capital) |
|
|
23,583,345 |
23,583,345 |
- |
738,933 |
1,477,866 |
2,239,191 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 24) |
|
Taxes, Insurances, Benefits & Regulatory Costs |
|
|
|
|
|
|
|
|
|
|
|
|
Real Property Tax – Land |
1.60% |
of land |
|
NOTE: Differentiate between one time, cyclic (every 2 or 5 years) and recurring (annual) | |||||
|
|
|
Real Property Tax – PPE |
1.60% |
of fixed assets |
|
and vary the formula in the Main worksheet accordingly. |
|
|
|||
|
|
|
Real Property Tax – Buildings |
0.80% |
of building |
|
For simplicity in this model, they are assumed to be annual fees to be conservative. | |||||
|
|
|
Land Lease & ROW |
0.00 |
US$/MT coal |
|
|
|
|
|
|
|
|
|
|
Property Insurance – PPE |
0.78% |
of fixed assets |
|
|
|
|
|
|
|
|
|
|
Property Insurance – Building |
0.78% |
of building |
|
|
|
|
|
|
|
|
|
|
Business Interruption Insurance |
0.56% |
of previous year’s revenue |
|
|
|
|
|
|
|
|
|
of Capital |
Special Education Fund – benefits to host community |
1.00% |
of land |
|
|
|
|
|
|
|
|
|
0.277% |
SEC Registration & Fees |
65,325.87 |
Securities & Exchange Commission (certificate of registration) |
|
|
|
|
|||
|
|
|
BIR Registration & Fees |
530.00 |
Bureau of Internal Revenue (registration of TIN, VAT) |
|
|
|
|
|
||
|
|
0.007% |
DENR Permits & Fees |
1,650.83 |
Department of Environment & Natural Resources (EIS, ECC) |
|
|
|
|
|||
|
|
|
Discharge Fee (BOD, TSS) – DENR |
0.00 |
water pollution discharge permit (4 wastes at 600 each) |
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|
|
0.028% |
EMB Permits & Fees |
6,603.34 |
Environment Management Bureau (air quality) |
|
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||
|
|
|
NWRB Permits & Fees |
17,416.50 |
National Water Resources Board (water use permit) |
|
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||
|
|
|
PNRI Permits & Fees |
5,900.00 |
Philippine Nuclear Research Institute (radioactive material license) |
|
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|
|
ERC Registration & Fess |
1,500.00 |
Energy Regulatory Commission (certificate of compliance, authority to operate) |
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|
|
0.015% |
DOLE Permits & Fees |
3,537.50 |
Department of Labor & Employment (permit to operate pressurized vessels) |
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|
|
DTI Permits & Fees |
0.00 |
Department of Trade & Industry (registration of business name, with SEC now for corporation) |
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|||||
|
|
0.142% |
LGU Registration & Fees |
33,488.35 |
Local government units (barangay, municipal, provincial, regional) |
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|
|
0.002% |
NTC Registration & Fees |
471.67 |
National Telecommunication Commission (radio station permit) |
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|
BOC Registration & Fees |
5,000.00 |
Bureau of Customs (accreditation and registration) |
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PPA Registration & Fees |
1,000.00 |
Philippine Port Authority (permit to operate shore line facilities) |
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|
ATO Registration & Fees |
13,050.00 |
Air Transportation Office (height clearance permit for smoke stack) |
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|
PDEA Registration & Fees |
3,000.00 |
Philippine Drug Enforcement Agency (essential chemicals commodity permit) |
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|
|
BOI Registration & Fees |
4,500.00 |
Board of Investment (certificate of registration) |
|
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|
|
|
DOE Permits & Fees |
800.00 |
Department of Energy (authority to import, certificate of registration) |
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Local Business Taxes (1/2 of 1% of GR) |
0.00% |
of gross revenue |
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National Franchise Taxes (1/2 of 1% of GR) |
0.00% |
of gross revenue |
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Total Taxes, Insurances, Benefits & Regulatory Costs |
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| 25) |
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Cost of debt (loan interest) |
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10.00% |
Reference interest rate (Libor or other) |
12 |
loan term |
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2.00% |
Spread |
3.00 |
grace period (construction period) |
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12.00% |
Interest rate of debt |
1 |
loan amortization method (1 = constant principal repayment, 0 = declining balance method) |
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| 26) |
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Capital Structure (equity & debt) |
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15.00% |
% to be financed by capital |
30.00% |
Equity IRR |
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0.00% |
% to be financed by non refundable subsidy |
0.00% |
Subsidy |
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12.00% |
% to be financed by debt |
70.00% |
Debt Interest |
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Initial amount of capital |
12.90% |
WACC |
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| 27) |
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Debt Service Reserve Fund |
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6 |
months of debt service |
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4.00% |
DSRF Income -interest on Foreign Currency Deposit |
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|
7.50% |
Withholding Tax on Foreign Currency Deposit |
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0.30% |
DSRF Expense – withholding tax |
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| 28) |
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Equity Structure (shareholder contribution) |
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planned |
Annual dividend payable |
actual |
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60.00% |
Investor 1 |
83.57% |
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20.00% |
Investor 2 |
-5.91% |
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20.00% |
Investor 3 |
22.33% |
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| 29) |
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Your done. Now converge the model by pressing ctrl + d |
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| 30) |
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Press ctrl + g to optimize CCGT engine and plant location |
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| 31) |
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Press ctrl + r to update Summary Table |
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| 32) |
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Press ctrl + q to update Sensitivity Table |
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| 33) |
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Vary electricity tariff and see impact on NPV, IRR and payback. |
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Go to Main worksheet |
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(impact of electricity tariff) |
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Update cell E5 (electricity tariff, $/kWh) |
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View results for NPV, IRR and payback (cells F6..H9) |
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Press ctrl + r to preserve Summary Table |
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| 34) |
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Determine capital cost given electricity tariff, fuel cost and O&M cost to meet IRR. |
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Go to Main worksheet |
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(impact of capital cost) – maximum capital cost to meet minimum IRR |
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Update cell E5 (electricity tariff, $/kWh) |
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Go to Sensitivity worksheet |
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Use goal seek to determine capital cost to meet IRR: |
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Set cell C16 (NPV) to zero by varying cell B9 (sensitivity factor for capital cost) |
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Press ctrl + r to preserve Summary Table |
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| 35) |
|
Determine main fuel cost (pipeline natgas) given electricity tariff, capital cost and O&M cost to meet IRR. | Go to Main worksheet |
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(impact of main fuel cost) – maximum fuel cost to meet minimum IRR |
|
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Update cell E5 (electricity tariff, $/kWh) |
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Go to Sensitivity worksheet |
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Use goal seek to determine capital cost to meet IRR: |
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Set cell C16 (NPV) to zero by varying cell B8 (sensitivity factor for main fuel cost) |
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||||
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Press ctrl + r to preserve Summary Table |
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| 36) |
|
Determine rated capacity given electricity tariff, capital cost and O&M cost to meet IRR. |
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Go to Main worksheet |
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(impact of rated capacity) – minimum rated capacity to meet minimum IRR |
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Update cell E5 (electricity tariff, $/kWh) |
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Go to Sensitivity worksheet |
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Use goal seek to determine capital cost to meet IRR: |
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Set cell C16 (NPV) to zero by varying cell B10 (sensitivity factor for rated capacity) |
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Press ctrl + r to preserve Summary Table |
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(C) Copyright 2009 by Marcial T. Ocampo (November 2009)
2 Responses to “Project Finance Models for Power Plants with Carbon Credits under CDM (download file)”
Leave a Reply
August 30th, 2011 at 1:15 pm
Dear, I always like this kind of articles, hope you can writer more the articles like this. I’m looking forward you!
August 30th, 2011 at 6:04 pm
Hi Micki (Miss or Mr),
Thanks for your appreciative comment.
Sure, I will continue writing articles of great importance and interest to my blog readers.
Regards,
Marcial