Consider the costs of two options for a new low-carbon power plant: a traditiona
ID: 1903595 • Letter: C
Question
Consider the costs of two options for a new low-carbon power plant: a traditional coal fired power plant with a carbon capture and sequestration system or a solar thermal power plant. To build a coal fired power plant to produce 750 MW would cost about $1 billion dollars, a carbon capture and sequestration system for that power plant would cost about $0.3 billion, and a solar thermal plant capable of producing a similar amount of energy (considering the fact that solar thermal plants cannot operate continuously) would cost about $3.7 billion. While all plants have some costs associated with operation, the coal main cost of operating the coal plant is the supply of coal. A 750MW coal plant consumes about 3 million tons of coal per year and currently coal costs about $35 per ton. All other operating costs for the coal plant, the carbon capture and storage and the solar thermal plant are small compared to the cost coal and can be ignored. 2a) How many years would it take for the total cost (initial plus operating) of the coal plant to equal the total costs of the solar thermal plant at current coal prices? You do not need to consider any differences that might arise from differences in when the costs occurExplanation / Answer
coal fired: 750 MW 1 billion dollars 0.3 billion dollars 3 million tonnes of coal per year. cost= 35 dollar per tonn 1.3billion + 2 million X N X 35 = 3.7 billion N= 2.4 billion / 2 million X 35 in 34.2 years. if coal costs 60 dollar , N= 20 years. solar fired: 3.7 billion dollars so, solar fired power plants are better,