Power and light has committed to building solar power plant

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Reference no: EM131784518

Florida Power and Light has committed to building a solar power plant. JoAnne, an IE working for FPL, has been tasked with evaulating three current designs. FPL uses an interest rate of 10% and a 20-year horizon.

Design 1: Flat Solar Panels

A field of "flat" solar panels angeled to best catch the sun will yield 2.6 MV of power and will cost $87 million initially with first-year operating costs at $2 million, growing $250,000 annually. It will produce electricty worth $6.9 million the first year and will increase 8% each year thereafter.

Design 2: Mechanized Solar Panels

A field of mechanized solar panels rotates from side to side so that they are always positioned parallel to the sun's rays, maximizing the production of electricty. This design will yield 3.1MV of power and will cost $101 million initially, growing $300,000 annually. It will produce electricity worth $8.8 million the first year and will increase 8% each year thereafter.

Design 3: Solar Collector Field

This design uses a field of mirrors to focus the sun's rays onto a boilter mounted in a tower. The boiler then produces steam and generates electricty the same way a coal-fired plant operates. This system will yield 3.3 MV of power and will cost $91 million initally with first-year operating costs at $3 million, growing $350,000 annually. It will produce electricity worth $9.1 million the first year and will increase 8% each year thereafter.

Reference no: EM131784518

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