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6.3 Preliminary Analysis by Screening Curve Before Formulating The 6.3 Preliminary Analysis by Screening Curve Before formulating the generation development plan using simulation tools, the Study team conducted a preliminary analysis using the screening curve method. This analysis provides basic information for generation development planning such as the cost of development and operation and the roughly estimated capacity required to develop each candidate unit in the future. 6.3.1 Screening Curve Analysis The characteristics of future candidate units shown in Table 6.2.37 are used for the screening curve analysis. Figure 6.3.1 shows the results of the analysis. 40 Diesel (Residual Oil) 10MW Diesel (Furnace Oil) 10MW 35 Steam Turbine (Furnace Oil) 150MW Steam Turbine (Furnace Oil) 300MW Steam Turbine (Coal) 300MW 30 Gas Turbine (Auto Diesel Oil) 35MW Gas Turbine Gas Turbiine (Auto Diesel Oil) 105MW Specific Costs (cent/kWh) Combined Cycle (Auto Diesel Oil) 150MW 25 Combined Cycle (Auto Diesel Oil) 300MW Moragolla Hydropower Gin Ganga Hydropower 20 Broadlands Hydropower Uma Oya Hydropower 15 Coal-fired Steam Turbine Combined Cycle 10 Uma Oya : PF=32.8% 5 Broadlands : PF=41.1% Gin Ganga : PF=48.9% Moragolla : PF=46.5% 0 0 % 10 % 20 % 30 % 40 % 50 % 60 % 70 % 80 % 90 % 100 % Annual Plant Factor (%) Figure 6.3.1 Results of Screening Analysis (Specific Cost) As shown in Figure 6.3.1, the cost break point between a coal-fired steam turbine unit and an auto diesel oil-fired combined cycle unit is around 17% of the capacity factor in the screening curve and the cost break point between an auto diesel oil-fired combined cycle unit and a gas turbine unit is around 8% of the capacity factor. These results show that many coal-fired steam turbine units will likely be developed in consideration of economic operation of the system. It is also anticipated that none of the hydropower development projects will gain a competitive advantage over coal-fired thermal power development. Figure 5.4.2 shows the results of another screening curve analysis on annual production cost. The figure shows that variable cost of a coal-fired steam turbine power plant is remarkably lower than other candidate power plants. Also the figure shows that gas turbine power plants have an advantage for development as a plant for peak demand due to the fact that they have lower initial invest cost even though they have higher variable cost. 6-49 r 800 Diesel (Residual Oil) 10MW Diesel (Furnace Oil) 10MW 700 Steam Turbine (Furnace Oil) 150MW Steam Turbine (Furnace Oil) 300MW Steam Turbine (Coal) 300MW Gas Turbine (Auto Diesel Oil) 35MW 600 Gas Turbine (Auto Diesel Oil) 105MW Combined Cycle (Auto Diesel Oil) 150MW Combined Cycle (Auto Diesel Oil) 300MW Moragolla Hydropower 500 Gin Ganga Hydroppower Broadlands Hydropower Uma Oya Hydropower 400 Moragolla : PF=46.5% Annual Production Cost (USD/kW-yea Cost Production Annual 300 Gin Ganga : PF=48.9% Broadlands : PF=41.1% 200 Uma Oya : PF=32.8% 100 0 0 % 10 % 20 % 30 % 40 % 50 % 60 % 70 % 80 % 90 % 100 % Annual Plant Factor (%) Figure 6.3.2 Results of Screening Analysis (Annual Production Cost) Reference The equation for calculating the annual production costs of candidate units in the screening analysis is as shown below: Annual Production Cost = APC (US$/kW-year) T ( i x FIC ) (APC) = [ r ] x I + + 12 x ( O&M ) + 8.76 x [( FC ) + ( O&M )] x f i 100 fixed f variable 100 T T i x (1 + i) [ r ] i = T ( 1 + i ) - 1 where: APC = Annual Production Cost I = Investment Cost FIC = Fuel Inventory Cost FC = Fuel Cost O&M = Operation and Maintenance Cost T = Plant Life i = Annual Interest Rate (12% in this case) f = Average Annual Capacity Factor of the Plant (%) T [ r ] i = Annual Capital Recovery Factor (levelized annual fixed charge rate) (Source: WASP-IV Manual, IAEA, 2000) 6-50 6.4 Simulation for Generation Development 6.4.1 Configuring Development Scenarios The Study sets up development scenarios for the formulation of generation development plans from the perspective of a strategic environmental assessment (SEA). In this way, a plural number of alternative plans are formulated and evaluations from a variety of perspectives, including environmental, are integrated. The development scenario configured in the formulation of generation development plans is given below. Configuration of the zero option scenario was taken beyond the scenario configured for formulation of the generation development plan to the broader perspective involved in formulation of the Master Plan. (1) Zero option scenario The Master Plan not formulated (2) Generation development scenario (a) Scenario of Development of Large-scale Thermal Power Plant There are no limitations on power source facilities to be developed (b) Scenario of No-Development of Large-scale Thermal Power Plant There are limitations on power plants to be developed (Installed Capacity 150 MW or less) (c) Scenario of Hydropower Development Oriented Promote the development of a promising candidate site for hydropower development (d) Scenario of Natural Gas Supply Natural gas will be provided from 2020 or later Explanations of the various scenarios are provided below. (1) Zero Option Scenario A zero option scenario was configured in the master plan. A zero option scenario considers what direction the power sector would take if this master plan were not formulated. The CEB has adequate technical capabilities for formulating development plans in the various fields involved in the formulation of power development plans. It will be able to continue formulating its own development plans in the future, as well. The power sector, however, faces severe conditions. The costs of power supply are high, for example, and power tariffs do not match them. Demand is increasing while supply is inadequate, so that the country faces the possibility of serious power shortages in the near future. The financial situation of the CEB is deteriorating. These kinds of deterioration in conditions also appear to occur in a kind of vicious cycle, and it is impossible to escape from that cycle just by formulating technically appropriate power development plans. Conditions are expected to deteriorate still further in the future. For the Master Plan, the official international agency known as the Japan International Cooperation Agency (JICA) presented recommendations for the formulation of long-term power development plans with environmental and social considerations. JICA also identified issues for power sector in organizational and institutional aspects and presented recommendations on them. If comprehensive Master Plan were not presented, then the power sector would not have found any way to escape from the vicious cycle it had fallen into. Moreover, the CEB would probably not have had the opportunity to improve its own capabilities for framing and implementing the measures for escaping from the cycle itself. 6-51 (2) Generation Development Scenario (a) Scenario of Development of Large-scale Thermal Power Plant In this scenario, there are no limitations on the power plants to be developed. It is assumed that development of all the power sources shown in Table 6.2.37 as candidates for development is possible. The context for this scenario configuration envisions that funding has been procured for the development of large-scale thermal power plants for the purpose of reducing supply costs. (b) Scenario of No-Development of Large-scale Thermal Power Plant Here it is envisioned that, of the power plants that are candidates for development, the 150 MW and smaller power plants are developed while large-scale thermal power plants are not. Consequently, the power plants shown below have been excluded as candidates for development. ・300 MW oil-fired steam turbine thermal power ・300 MW coal-fired steam turbine thermal power ・300 MW oil-fired steam turbine thermal power The background of this scenario configuration is the assumption that funding procurement did not take place for the development of large-scale thermal power plants, which require enormous amounts of development funding. There had long been a strong desire for the development of large-scale coal-fired thermal power plants. The fact is that such power plants have not been developed, however, and this scenario envisions the continuation of this state. (c) Scenario of Hydropower Development Oriented This scenario envisions the implementation of a promising hydropower development project from among candidates for development. The background of this scenario configuration is the assumption that hydropower development receives low-interest financing through official development assistance. Consequently, in this scenario, the projects that received development priority through funding are assumed to have been implemented. In light of this scenario configuration context, the development projects and their development year were decided on the basis of the results of sensitivity analysis (cases in which the discount rate was 2%, see Section 6.6). The hydropower development projects that are to be implemented under the present scenario are shown below. ・Broadlands hydropower development project: Operation to begin in 2011 ・Gin Ganga hydropower development project: Operation to begin in 2014 ・Moragolla hydropower development project: Operation to begin in 2014 ・Uma Oya hydropower development project: Operation to begin in 2016 (d) Scenario of Natural Gas Supply This scenario envisions the adoption of natural gas, one of the new energy options. The U.S. Agency for International Development (USAID) conducted a feasibility study in 2003 regarding the introduction of natural gas. The study concluded that demand for natural gas in Sri Lanka is so small that it would be difficult for a natural gas project to become economically efficient. As of November 2005, no concrete project is in existence. This scenario takes this situation into consideration and envisions that a supply of natural gas to the power sector will become available in the year 2020 or later. As regards the determination of supply prices, the price of imported natural gas is generally linked with the price of oil.
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