Engineering Economy
Engineering Economy
16th Edition
ISBN: 9780133582819
Author: Sullivan
Publisher: DGTL BNCOM
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Chapter 11, Problem 40FE
To determine

Calculate the cost of electricity.

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Two electric motors​ (A and​ B) are being considered to drive a centrifugal pump. Each motor is capable of delivering 60 horsepower​ (output) to the pumping operation. It is expected that the motors will be in use 1,200 hours per year. If electricity costs ​$0.09 per​ kilowatt-hour and 1 hp​ = 0.746 ​kW, which motor should be selected if MARR​ = 7​% per​ year? Refer to the data below.
Two electric motors (A and B) are being considered to drive a centrifugal pump. Each motor is capable of delivering 40 horsepower (output) to the pumping operation. It is expected that the motors will be in use 800 hours per year. If electricity costs $0.08 per kilowatt-hour and 1 hp = 0.746 kW, which motor should be selected if MARR = 6% per year? Refer to the data below. The AW for Motor A is $ Initial Cost Electrical Efficiency Annual Maintenance 5 years Click the icon to view the interest and annuity table for discrete compounding when the MARR is 6% per year. (Round to the nearest dollar.) Motor A $1,700 0.75 $50 Life Motor B $900 0.55 $80 5 years
An integrated, combined cycle power plant produces 285 MW of electricity by gasifying coal. The capital investment for the plant is $570 million, spread evenly over two years. The operating life of the plant is expected to be 20 years. Additionally, the plant will operate at full capacity 75% of the time (downtime is 25% of any given year). The MARR is 6% per year. Solve, a. If this plant will make a profit of three cents per kilowatt-hour of electricity sold to the power grid, what is the simple payback period of the plant? Is it a low-risk venture? b. What is the IRR for the plant? Is it profitable?
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