4 PPA Price sensitivity GSU Amorphous transformer investment
AM transformers would have cost the site developer another $ 450,000 on top of the $ 250,000,000 original investment – less than one percent. But the higher efficiency of the collector network would have generated an additional $ 129,000 per year of energy sales, assuming a PPA (power purchase agreement) of $ 70/MWh. Classifying it as a good investment would require a positive net present value (NPV) and double digit internal rate return (IRR). On calculating the returns, a 30 percent income tax credit was assumed and an unleveraged investment or zero financing cost. The return on the additional $ 450,000 using a $ 70/MWh PPA was a 25 percent IRR and $ 467,000 NPV. For a $ 50/MWh PPA, the return is still an acceptable 20 percent IRR and $ 300,000 NPV. So the additional investment in lower loss AM transformers would be a good investment.
The necessary financial and site specific details may not be available at the time of tendering the transformer. But without these details, the transformer manufacturers will have difficulty designing to the most optimal design relative to Total Ownership Cost (TOC). TOC being the purchase price plus cost of operating the transformer over its useful life. So ABB worked with a financial modeling company to develop an on-line tool for capitalizing the no-load (A) and load losses (B) for individual renewable sites. These factors would then be given to the transformer manufacturer at the time of transformer tender for optimizing a design to the lowest TOC. This tool is available by going to www.abb.com/transformers and selecting transformer calculators.
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Douglas Getson
ABB Power Products, Transformers
Jefferson City, MO, United States
[email protected]
Peter Rehnström
ABB Power Products, Transformers
Ludvika, Sweden
[email protected]
Gal Brandes
ABB Power Products, Transformers
Genève, Switzerland
[email protected]
Egil Stryken
ABB Power Products, Transformers
Drammen, Norway
[email protected]