Principle of Water Content Test of Insulating Oil
Collecting Oil Sample from Oil Immersed Electrical Equipment
Causes of Insulating Oil Deterioration
Acidity Test of Transformer Insulating Oil
Magnetic FieldClosely Related Articles
Steam Condenser of Turbine
Jet Condenser | Low Level High Level Ejector Jet Condenser
Surface Steam Condenser
Economics of Power Generation
Steam Boiler | Working principle and Types of Boiler
Methods of Firing Steam Boiler
Fire Tube Boiler | Operation and Types of Fire Tube Boiler
Water Tube Boiler | Operation and Types of Water Tube Boiler
Steam Boiler Furnace Grate Firebox Combustion Chamber of Furnace
Feed Water and Steam Circuit of Boiler
Boiler Feed Water Treatment Demineralization Reverse Osmosis Plant Deaerator
Coal Combustion Theory
Fluidized Bed Combustion | Types and Advantages of Fluidized Bed Combustion
Cooling Tower Useful Terms and Cooling Tower Performance
Cooling Tower Material and Main Components
Power Plant Fire Protection System
Hydrant System for Power Plant Fire Protection
Medium Velocity Water Spray or MVWS System for Fire Protection
Foam Fire Protection System
Fire Detection and Alarm System
Gas Extinguishing System
Electric Power Generation
Power Plants and Types of Power Plant
Thermal Power Generation Plant or Thermal Power Station
Hydro Power Plant | Construction Working and History of Hydro power plant
Nuclear Power Station or Nuclear Power Plant
Diesel Power Station
Why Supply Frequency is 50 Hz or 60 Hz?
Economiser in Thermal Power Plant | Economiser
MHD Generation or Magneto Hydro Dynamic Power Generation
Cogeneration | Combined Heat and Power
Thermoelectric Power Generators or Seebeck Power Generation
Cost of Electrical Energy
Gas Turbine Power Plant
Solar Energy System
Types of Solar Power Station
Components of a Solar Electric Generating System
Staebler Wronski Effect
Principle of Photovoltaic Cell
Characteristics of Solar Cell
Solar Cell Manufacturing Technology
Solar PV Module
Standalone Solar Electric System
Steam Dryness Fraction
Superheated Steam and Steam Phase Diagram
Vapour Properties Mollier Chart Heat Capacities
How to Calculate Steam Consumption During Plant Start Up
Effective Steam Distribution System
Engineering Thermodynamics Part 1
Engineering Thermodynamics Part 2
First Law of Thermodynamics
Enthalpy Entropy and Second Law of Thermodynamics
Rankine Cycle and Regenerative Feed Heating
Rankine Cycle for Closed Feed Water Heaters and Rankine Cycle Cogeneration
Ideal Verses Actual Rankine Cycle
Rankine Cycle Efficiency Improvement Techniques
Wind Energy Electricity Generation
Theory of Wind Turbine
Basic Construction of Wind Turbine
Economics of Power Generation
Economics of Power GenerationIn all new engineering enterprises of this era, the question of cost is of utmost importance. It is the role played by an engineer to achieve the desired technical result, with minimum cost that distinguishes him from a non engineer who can also possibly attain the same result, but at what cost? In a power generation industry we are usually confronted with a situation where we have to make a choice between equipment of high cost with high efficiency and their low cost counterpart with lower efficiency. In the first case, the charges due to interest and depreciation will be higher with lower energy bill as compared to the corresponding figures in the second case.
Here the role of the Electrical Engineer comes into play, where he has to balance the situation in such a way that the total expenditure of the plant is minimum, and thus the study of economics of power generation is of prime importance, taking all practical purposes into consideration.
To deduce the power generation economics effectively we should know the structure of annual expenditure of the plant and the factors affecting them. The total annual expenditure of the plant can be classified into several subheadings namely,
- Fixed Charges
- Semi fixed Charges
- Running Charges
Fixed Charges of Power GenerationFixed charges, as the name suggest does not vary either with the capacity of the plant or with plant operation. These costs remain fixed under all circumstances. These mainly include the salaries of higher officials of the central organization and the rent of the land reserved for future expansion.
Semi Fixed Charges of Power GenerationThese charges mainly depend on the installed capacity of the plant and are independent of the electrical energy output of the plant. These charges include the following :
- Interest and depreciation on the capital cost of the generating plant, transmission and distribution network, buildings and other civil engineering works etc. Capital cost of the plant also includes the interest paid during the construction of the plant, salaries of engineers and other employees, development and construction of the power station. It also includes cost incurred on account of transportation, labor etc. to bring the equipment on site and installing the same, all of which are involved for the overall economics of power generation. It is particularly note worthy, that in nuclear stations the capital cost of the station also includes the cost of initial charges of the nuclear fuel minus the salvage value paid at the end of its useful life.
- It also includes all types of taxes, insurance premiums pain on policies to cover the risk of accidental breakdown.
- Rent paid for the land being actually used for the construction purpose.
- The cost due to starting and shutting down of plants are also included in this category, when the power plant operates on one or two shift basis.
Running Charges of Power GenerationThe running charges or running cost of a power plant, is probably one of the most important parameters while considering the economics of power generation as it depends upon the number of hours the plant is operated or upon the number of units of electrical energy generated. It essentially comprises of the following costs incurred mentioned below.
- Cost of the fuel delivered coupled with the fuel handling cost in the plant. Coal is the fuel used in a thermal power plant, and diesel oil in case of a diesel station. In case of a hydro-electric plant there is no fuel cost as water is the free gift of nature. But a hydro-plant requires higher installation cost and their mega Watt output of power generation is also lower compared to the thermal power plants.
- Wastage of the operational and maintenance stuff and salaries of supervisor staffs engaged in running the plant.
- In case of a thermal power plant, power generation economics includes the cost of feed water for the boiler, like the cost of water treatment and conditioning.
- As the amount of wear and tear of the equipment depends on the extent to which the plant is being used, so the lubricating oil cost and repair and maintenance charges of the equipment are also included in the running charges.
- Where ‘a’ represents the total fixed cost of the plant, and has no relation with the total output of the plant or the number of hours for which the plant is running.
- ‘b’ represents the semi-fixed cost, which mainly depends on the total output of the plant and not on the number of hours for which the plant is being operated. The unit for ‘b’ is thus ideally chosen to be in k-Watt.
- ‘c’ essentially represents the running cost of the plant, and depends on the number of hours for which the plant is running to generate a certain mega watt of power. Its unit is given in K-Watt-Hr.
Closely Related Articles Steam Condenser of TurbineJet Condenser | Low Level High Level Ejector Jet CondenserSurface Steam Condenser More Related Articles Steam Boiler | Working principle and Types of BoilerMethods of Firing Steam BoilerFire Tube Boiler | Operation and Types of Fire Tube BoilerWater Tube Boiler | Operation and Types of Water Tube BoilerSteam Boiler Furnace Grate Firebox Combustion Chamber of FurnaceFeed Water and Steam Circuit of BoilerBoiler Feed Water Treatment Demineralization Reverse Osmosis Plant DeaeratorCoal Combustion TheoryFluidized Bed Combustion | Types and Advantages of Fluidized Bed CombustionCooling Tower Useful Terms and Cooling Tower PerformanceCooling Tower Material and Main ComponentsPower Plant Fire Protection SystemHydrant System for Power Plant Fire ProtectionMedium Velocity Water Spray or MVWS System for Fire ProtectionFoam Fire Protection SystemFire Detection and Alarm SystemGas Extinguishing SystemElectric Power GenerationPower Plants and Types of Power PlantThermal Power Generation Plant or Thermal Power StationHydro Power Plant | Construction Working and History of Hydro power plantNuclear Power Station or Nuclear Power PlantDiesel Power StationWhy Supply Frequency is 50 Hz or 60 Hz?Economiser in Thermal Power Plant | EconomiserMHD Generation or Magneto Hydro Dynamic Power Generation Cogeneration | Combined Heat and PowerThermoelectric Power Generators or Seebeck Power GenerationCost of Electrical EnergyGas Turbine Power PlantNuclear ReactorSolar ElectricitySolar Energy System | History of Solar EnergyTypes of Solar Power StationComponents of a Solar Electric Generating SystemWhat is Photovoltaic Effect?Staebler Wronski EffectWorking Principle of Photovoltaic Cell or Solar CellSolar CellCharacteristics of a Solar Cell and Parameters of a Solar CellSolar Cell Manufacturing TechnologyWhat is a Solar PV Module?What is Standalone Solar Electric System?Solar LanternSteamSteam Dryness FractionSuperheated Steam and Steam Phase DiagramVapour Properties Mollier Chart Heat CapacitiesWhat is Steam Flashing?How to Calculate Steam Consumption During Plant Start Up Effective Steam Distribution SystemWhat is Water Hammer?Engineering Thermodynamics Part 1Science of Engineering Thermodynamics Part 2Basic Law of Conservation and First Law of Thermodynamics Carnot Cycle and Reversed Carnot CycleEnthalpy Entropy and Second Law of ThermodynamicsRankine CycleRankine Cycle and Regenerative Feed HeatingRankine Cycle for Closed Feed Water Heaters and Rankine Cycle CogenerationIdeal Verses Actual Rankine CycleRankine Cycle Efficiency Improvement TechniquesWind Energy Electricity GenerationTheory of Wind Turbine Wind Turbine | Working and Types of Wind TurbineBasic Construction of Wind TurbineNew Articles Principle of Water Content Test of Insulating OilCollecting Oil Sample from Oil Immersed Electrical EquipmentCauses of Insulating Oil DeteriorationAcidity Test of Transformer Insulating OilMagnetic Flux