Consider the levelizing factor approach derived in Appendix A as applied to electricity bills for a household. Assume the homeowner's discount rate is the $6\%/$yr interest rate that can be obtained on a home equity loan, the current price of electricity is $$0\mathrm{.}12/$kWh$,$ and the time horizon is $10$ years.

a$.$ Ignoring fuel price escalation $($e$=0),$ what is the $10-$year levelized cost of electricity

$($$$/$kWh$)?$

b$.$ If fuel escalation is the same as the discount rate $(6\%),$ what is the levelizing factor and the levelized cost of electricity?

c$.$ With a $6\%$ discount rate and $4\%$ electricity rate increases projected into the future, what is the levelizing factor and the LCOE?