Annual revenue requirements

Net Annual Revenue Required Annual Hydrogen Production... 

An improved magnesium oxide (MgO) flue gas desulfurization process and its comparative economics are described. Innovations made include the use of a spray dryer, a cyclic hotwater reheater, and a coal-fired fluidized-bed reactor for regeneration of the MgO absorbent. Several technical concerns with the proposed design are addressed, including fly ash and chloride buildup. The economic evaluation shows the process to have a capital investment of about seven percent less than that of a conventional MgO scrubbing process and a 40 percent smaller annual revenue requirement. Finally, a sensitivity analysis is shown relating annual revenue requirements to the byproduct sulfuric acid price credit. 

The economic evaluation consists of a study-grade (-20 , +40 ) determination of capital investment, first-year annual revenue requirements, and levelized annual revenue requirements. The capital investments are based on major equipment costs (developed from the flow diagram and the material balance) and factored costs for installation, ancillary equipment, and indirect investments. The capital investments are based on mid-1982 costs. 

First-year annual revenue requirements consist of raw material, operating, and overhead costs and levelized capital... 

The first-year annual revenue requirements for the spray dryer MgO FGD process are 28.8M (10.47 mills/kWh) in mid-1984 dollars. The levelized annual revenue requirements for the spray dryer MgO process are 36.1M (13-13 mills/kWh). The first-year annual revenue requirements for the comparable limestone scrubbing process are 32.4M (11.78 mills/kWh) in mid-1984 dollars. The levelized annual revenue requirements for the limestone scrubbing process are 45.2M (16.43 mills/kWh). The first-year annual revenue requirements for the conventional MgO FGD process (including particulate control) are 40.4M (14.69 mills/kWh) in mid-1984 dollars. Levelized annual revenue requirements are 56.7M (20.61 mills/kWh). These costs are summarized in Table III. The complete details are presented in Tables A-IV, A-V, and A-VI in the Appendix. 

The first-year annual revenue requirements for the spray dryer MgO process are about 11 lower than those for the comparable limestone scrubbing process. This economic advantage for the spray dryer MgO process increases to nearly... 

The byproduct credit for sulfuric acid is the major reason for the lower spray dryer MgO annual revenue requirements. The credit of 6.0M lowers the first-year annual revenue... 

In the comparison of the annual revenue requirements for the spray dryer MgO process with those for the conventional MgO process, it is apparent that both the first year and the levelized annual revenue requirements are 40 lower for the spray dryer MgO process ( 28.8M vs. 40.4M for first year). The most significant difference between the processes is the energy cost, in particular, the fuel oil charges. The spray dryer MgO process uses expensive fuel oil only to operate the waste disposal equipment while the conventional MgO process uses fuel oil, not only for the waste disposal equipment (which is a relatively minor amount) but also to fire the calciner and... 

Since the annual revenue requirements for the spray dryer and conventional MgO processes appear to be sensitive to the byproduct credit for sulfuric acid, and since sulfuric acid prices have risen dramatically in the last few years, the sensitivity of the first-year annual revenue requirements to the price of byproduct sulfuric acid was projected. The results are shown in Figure 3. 

As is apparent from this figure the first-year annual revenue requirements can vary somewhat, depending on the price received from the byproduct sulfuric acid. The base-case credit of 65/ton of 10055 H2SO4 results in a first-year annual revenue requirement of 10.47 mills/kWh for the spray dryer MgO process and 14.69 mills/kWh for the conventional MgO process. At a byproduct credit of 35/ton which is approximately equivalent to the price of sulfuric acid in the past (or which could be the 1984 price netted after transportation costs are subtracted for a utility situated far from the ultimate consumer), the first-year annual revenue requirements for the spray dryer MgO process rise nearly 10 percent to 11.53 mills/kWh. This cost, although slightly lower than that for the limestone scrubbing process, is essentially equivalent given the accuracy associated with this study. For... 

FIRST-YEAR ANNUAL REVENUE REQUIREMENTS, mllls/kWh... 

Sensitivity of annual revenue requirements to byproduct sulfuric acid price. 

The spray dryer MgO process appears to have a slight advantage (about 10 ) over a comparable limestone scrubbing process in terms of both first-year and levelized annual revenue requirements. This new MgO process, however, has a higher capital investment than the limestone scrubbing process. 

The spray dryer MgO process has an economic advantage over the conventional MgO process in terms of capital investment (8 ), first-year annual revenue requirements (40 ), and levelized annual revenue requirements (40 ). The primary difference for this large cost advantage for the spray dryer MgO process is due to the lower energy consumption and the use of inexpensive coal to fire the calciner rather than No. 

Detailed capital and annual revenue requirement costs for the three processes studied here are presented in the following Tables A-I through A-VI. 

TABLE A-IV. CONVENTIONAL LIMESTONE PROCESS ANNUAL REVENUE REQUIREMENTS... 

Total first-year annual revenue requirements Levelized first-year operating and maintenance costs Levelized capital charges... 

Total first-year annual revenue requirements 28,781... 

Levelized annual revenue requirements JlSL. MiUg/kWh First-year annual revenue requirements 28.78 10.47 Levelized annual revenue requirements 36.11 13.13 36,113... 

TABLE A-VI.(continued). CONVENTIONAL MgO PROCESS ANNUAL REVENUE REQUIREMENTS Indirect Costs - First Year Overheads... 

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