Economic Analysis of Economic Analysis of Alternative Energy Sources Alternative Energy Sources Dec07- -03 03 Dec07 Team Members: Team Members: Kyle Drees (Team Leader) (EE) Kyle Drees (Team Leader) (EE) Mitchell Frazier (Communication Officer) (EE) Mitchell Frazier (Communication Officer) (EE) Peter Howard (EE) Peter Howard (EE) Abraham Tarbey (EE) Abraham Tarbey (EE) Advisors: Advisors: Professor John Lamont Professor John Lamont Professor Ralph Patterson III Professor Ralph Patterson III Professor Tom Baird Professor Tom Baird Client: Client: Senior Design Senior Design Presented: April 19 th th , 2007 , 2007 Presented: April 19
Definitions Definitions AES – – Alternative Energy Source Alternative Energy Source AES EAE – – Economic Analysis Engine Economic Analysis Engine EAE
Overview of May07- -03 Project 03 Project Overview of May07 The May07- -03 project is designed for a user that 03 project is designed for a user that The May07 is interested in alternative energy. This user will is interested in alternative energy. This user will input information about their needs and desires input information about their needs and desires for an alternative energy source into an for an alternative energy source into an economic analysis program that will be featured economic analysis program that will be featured on a website. on a website. The output displayed by the program will contain The output displayed by the program will contain the most cost effective alternative energy the most cost effective alternative energy solution as calculated by an EAE used in the solution as calculated by an EAE used in the program. The output will be dependent on the program. The output will be dependent on the specifications of the user. specifications of the user.
Overview of Dec07- -03 Project 03 Project Overview of Dec07 The Dec07- -03 project will create a more accurate and 03 project will create a more accurate and The Dec07 robust EAE than the one currently in place in the May07- - robust EAE than the one currently in place in the May07 03 project in order to determine the costs associated 03 project in order to determine the costs associated with each possible solution. with each possible solution. Using different spreadsheets, Excel will be used to Using different spreadsheets, Excel will be used to accurately process incoming data into an output accurately process incoming data into an output containing the most economical system available to the containing the most economical system available to the user and the costs associated with that system. user and the costs associated with that system. The Excel program will act as a mathematical tool to The Excel program will act as a mathematical tool to facilitate overall functionality of the project. facilitate overall functionality of the project.
Assumptions Assumptions The EAE will have no user interface. All necessary user inputs will come will come The EAE will have no user interface. All necessary user inputs from May07 from May07- -03 03’ ’s Source Feasibility Calculator. The interface of the Excel s Source Feasibility Calculator. The interface of the Excel program will not be user friendly. program will not be user friendly. The May07- -03 03’ ’s Source Feasibility Calculator will provide the EAE with the s Source Feasibility Calculator will provide the EAE with the The May07 forms of alternative energy solutions to evaluate and the method in which in which forms of alternative energy solutions to evaluate and the method they will be installed. The EAE will make no determinations as they will be installed. The EAE will make no determinations as to which to which solutions are feasible; only calculate and output the costs associated with ciated with solutions are feasible; only calculate and output the costs asso the specified system. the specified system. The current state of the May07- -03 project may not be suitable to supply the 03 project may not be suitable to supply the The current state of the May07 EAE with the data it needs. Improvements to their program may h EAE with the data it needs. Improvements to their program may have to be ave to be performed at a later date in order to facilitate use of the EAE. performed at a later date in order to facilitate use of the EAE. Storage solutions will be limited to batteries due to problems evaluating the valuating the Storage solutions will be limited to batteries due to problems e feasibility of other possible solutions. feasibility of other possible solutions. It will be assumed that the alternative energy solution will pro It will be assumed that the alternative energy solution will provide energy to vide energy to one lumped load. one lumped load. Data built into the EAE will be based off of information available at the time. le at the time. Data built into the EAE will be based off of information availab Updated information will have to be inputted manually at a later date. date. Updated information will have to be inputted manually at a later
Considerations Considerations The following considerations will not apply to this The following considerations will not apply to this project: project: Economic Economic Environmental Environmental Social Social Political Political Ethical Ethical Health and safety Health and safety Manufacturability Manufacturability
Alternative Energy Sources Alternative Energy Sources Wind Wind Solar Solar Petroleum- -Generator Generator Petroleum Micro- -Turbines Turbines Micro Micro- -Hydro Hydro Micro Fuel Cells Fuel Cells Storage Storage
System Types System Types AES with Grid Storage AES with Grid Storage AES with Utility Buyer AES with Utility Buyer AES with Utility Seller AES with Utility Seller AES Standalone without Backup AES Standalone without Backup AES with Storage and Grid Connection AES with Storage and Grid Connection AES with Storage AES with Storage Grid with Storage Grid with Storage Grid Only Grid Only
Inputs Inputs Customer Data Customer Data Utility Supplier Data Utility Supplier Data Geographical Data Geographical Data Equipment Alternative Selected Equipment Alternative Selected
Database Database Manufactures Equipment Details Manufactures Equipment Details Installation Locations Installation Locations Basic Loads Basic Loads Costs Costs Pollution Pollution Inflation/Expected Load Increase Inflation/Expected Load Increase System Lifespan System Lifespan Incentives/Rebates Incentives/Rebates
Incentives/Rebates Incentives/Rebates Iowa Code § § 422.45 422.45 Iowa Code – – No State tax on total cost of wind energy system No State tax on total cost of wind energy system Iowa Code § § 17A.4 and Iowa Code Chapter 476B and 17A.4 and Iowa Code Chapter 476B and Iowa Code 476C 476C – 1.5 c per KWH and can not exceed 2.5MW 1.5 c per KWH and can not exceed 2.5MW – Iowa Energy Center Iowa Energy Center – Alternate Energy Revolving Loan Program Alternate Energy Revolving Loan Program – – Iowa Building Energy management Iowa Building Energy management – – Local Option Special Assessment of Wind Energy Devices Local Option Special Assessment of Wind Energy Devices – – Wind Energy Equipment Exemption Wind Energy Equipment Exemption – – Property Tax Exemption for Solar Systems Property Tax Exemption for Solar Systems – – Investment Tax Credit for Solar Property Investment Tax Credit for Solar Property – – Federal 5 Federal 5- -Year Depreciation Schedule for Solar Energy Property Year Depreciation Schedule for Solar Energy Property – http://www.legis.state.ia.us/Rules/2006/Bulletin/IAB060927.pdf http://www.energy.iastate.edu/
Calculations Calculations Wind Turbine Power: Wind Turbine Power: � x A x Cp x V^3 x Ng x Nb P = 0.5 x � – P = 0.5 x x A x Cp x V^3 x Ng x Nb – Solar Solar – P = Efficiency x Area x Luminescence – P = Efficiency x Area x Luminescence Micro- -Hydro Hydro Micro – P = 5.9 x flow rate x ft of head P = 5.9 x flow rate x ft of head – Others Others – – Dependent on the Efficiency of the System Dependent on the Efficiency of the System Inflation/Increase Inflation/Increase Linear Gradient � � � � N N ( 1 i) iN i ( 1 i) iN 1 + − − + − − PW G � � Where A G � � = = 2 � N � � N � i ( 1 i) i( 1 i) 1 + + − Geometric Gradient Present Worth and Feature Worth � � � N N − 1 ( 1 g) (1 i ) − + + � A � � 1 � � N N � i g − − PW F (1 i ) and F P (1 i ) = � = + = + PW � � N � � � A if i g = � 1 � � � 1 i +
Output of Costs Output of Costs Overall Cost Overall Cost Installation Cost Installation Cost Operating Cost Operating Cost Maintenance Cost Maintenance Cost Equipment Cost Equipment Cost
Output of Equipment Output of Equipment System Capacity System Capacity Manufacturer/Model Information Manufacturer/Model Information Estimated Lifespan Estimated Lifespan
Other Outputs Other Outputs Incentives Incentives Pay- -back back Pay Assumptions Assumptions Disclaimer Disclaimer
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