In: Economics
Question: You have been asked to evaluate the economic implications of various methods for cooling condense...
You have been asked to evaluate the economic implications of various methods for cooling condenser effluents from a 200-MW steamelectric plant. There are two basic types of cooling towers: wet and dry. Furthermore, heat may be removed from condenser water by (1) forcing (mechanically) air through the tower or (2) allowing heat transfer to occur by making use of natural draft. Consequently, there are four basic cooling tower designs that could be considered. Assuming that the cost of capital to the utility company is 15% per year, your job is to recommend the best alternative (i.e., the least expensive during the service life). Further, assume that each alternative is capable of satisfactorily removing waste heat from the condensers of a200-MW power plant. What noneconomic factors can you identify that might also play a role in the decision-making process?
Wet Tower Mech. Draft | Wet Tower Natural Draft | Dry Tower Mech. Draft | Dry Tower Natural Draft | |
Initial Cost | $2.7 million | $8.7 million | $4.9 million | $9.0 million |
Power for I.D. fans | 40 200-hp I.D. fans | None | 20 200-hp I.D. fans | None |
Mechanical maintnance/year | $0.16 million | $0.10 million | $0.12 million | $0.12 million |
Service Life | 30 years | 30 Years | 30 Years | 30 Years |
Market Value | 0 | 0 | 0 | 0 |
Power for pumps | 20 150-hp pumps | 20 150-hp pumps | 40 100-hp pumps | 40 100-hp pumps |
100 hpequals=74.6 kW; cost of power to plant is 2.2 cents per kWh or kilowatt-hour; induced-draft fans and pumps operate around the clock for 365 days/year (continuously). Assume that electric motors for pumps and fans are 90% efficient.
*The AW of Wet Tower, Mechanical Draft is $-2,328,388. (Round to the nearest dollar.)
*The AW of Wet Tower, Natural Draft is $___________(Round to the nearest dollar.)
*The AW of Dry Tower, Mechanical Draft is $____________(Round to the nearest dollar.)
*The AW of Dry Tower, Natural Draft is $______________(Round to the nearest dollar.)
*What is the best alternative? Choose the correct answer below.
A. Wet Tower, Natural Draft
B. Dry Tower, Mechanical Draft
C. Wet Tower, Mechanical Draft
D. Dry Tower, Natural Draft
*Should such non-economic factors as operating issues and licensing be taken into consideration?
Yes or No