An electric utility is considering a photovoltaic (PV) solar panel system to provide power to water conditioning
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An electric utility is considering a photovoltaic (PV) solar panel system to provide power to water conditioning pumps within the power plant. The project will be done in two phases. Phase 1 has an initial cost of $2.5 million. Phase 2 will cost $2 million at the beginning of year 3. The system will be put into service at the beginning of year 4. The annual savings using the PV panels is estimated to be $800,000, increasing by $150,000 per year through year 10. The utility’s MARR is 12%.
a. Determine if the cost of the PV system is justified.
b. What is the actual rate of return for this project?
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Related Book For
Thermal Energy Systems Design And Analysis
ISBN: 9781138735897
2nd Edition
Authors: Steven G. Penoncello
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