LNG vs Coal cost comparison

Below is a side by side comparison of the same sized power plant fired by coal and the lowest priced LNG coming out of North America.

 

COAL
installed Capacity (MW) 381 381
Rated output (MW) based on CF 90% 342.9 342.9
Uptime 0.85 0.85
# Days 365 365
Projected Run hrs 7446 7446
Total Generated power (MWh) 2553233.4 2553233.4
Plant Rated Eff  (Single Cycle)
Plant Rated Eff  (APC) 38% 50%
Average Heat capacity (GJ/KG) & MWH/CF 0.0305 5.13373E-06
Total volume of FUEL Req ( Coal KG/ lng CF)) 674106488.70 16578153629
Total volume of fuel Req (Coal -Ton, LNG – CF)) 674106.49 290387.7454
Cost  fuel {(Coal US$/ (Ton & LNG US$/1000 CF}  $                   69.00  $               0.0104
Total Fuel Cost /Annum (US$)  $         46,513,348  $    171,583,890
Fuel cost as % total cost 75% 85%
O&M  Fixed  $         10,691,622 15%
O&M  variable  $         11,412,953
Est total annual cost  $         68,617,923  $    201,863,400
Fuel Cost / GJ  $                     5.95
Fuel Cost / KWH  $                 0.0214  $               0.0672
Total Cost per KWH  $                 0.0316  $               0.0791
Interest payment  $   78,754,363.06  $       43,019,358
Total Annual Cost Incl Int Pay  $      147,372,286  $    244,882,758
Generated cost per Kwh  $                 0.0577  $               0.0959
Plant Est Cost  $   1,117,854,000  $    656,000,000
Loan amount  $   1,017,854,000  $    556,000,000
Ave weighted cost of borrowing 6.6% 6.60%
Length of loan yrs 30 30
ROI > 6.6%( After tax) 8.5% 8.50%
Tax Rate 33% 33.30%
EBT based on 33% Int rate
Total Generation Revenue to meet ROI  $      303,319,748  $    336,398,766
Sale Price to JPS  $                 0.1188  $               0.1318
Life cycle Cost (LCC)  $   2,507,132,541  $ 2,964,509,763
Using Int rate of 10%
Life time 30 yrs
Advertisements

2 Responses

  1. Jay, can you please explain to me, the “uninformed”. Everyone is aware about how old the current JPS equipment is. However, I’ve heard that part of the reason that they have remained in use past their intended useful lifespan is because the current license discourages upgrading. Is this true? And wouldn’t one of the quickest fixes to the current energy problem be to ammend the JPS license to encourage JPS to upgrade and penalize them for using less efficient equipment? Looking forward to you shedding some light 🙂

    • It’s not really that the license of 2011 discourages the upgrade, the problem is the license says the anything above 15 MW must go to competitive tender, which is really a dumb thing, given its the assets of the company and not that of the Government of Jamaica.
      Here are the relevant sections of the amended license of 2011.

      Section 4 part A) of the exclusive license reads in respect of the 2001 license, which remains in effect on 2027.

      a) In the first three (3) years of this license the licensee shall have the exclusive license to develop new generating capacity. At the end of this period the licensee shall have the right with others to compete for the right to develop new generating capacity.

      Now this is like say, I will sell you this old car and you have three years to do any form of upgrade. Once that process is complete, you will have to go to tender and compete with others to install a more efficient engine.

      Further in the act it says. under condition #18
      Competition for New Generation

      Sections 1 – 6.
      page 11 and 12.

      JPS must go to a tender for any generation capacity above 15MW. This means JPS cannot simply source upgraded equipment to improve its efficiency, but instead must use the competitive tender process going through the OUR . This apparently is contained in a June 2006 act relating to the Addition of Generating Capacity to the Public Electricity Supply System.

      I will post a link to the document in a new post related to this question.

      So a part of the reason for high electricity cost in Jamaica is that dumb act mentioned above.
      It can however be waived by the OUR, but I am not sure the OCG would agree with that.

      The best approach therefore is to remove those offending sections from the All Island electricity supply license as well as changing the clause in the Addition of Generating Capacity to the Public Electricity Supply System.

      Hope this helps clear things up

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: