researcharticle cost-benefit analysis for the...

Research ArticleCost-Benefit Analysis for the Concentrated Solar Power in China

Shuxia Yang Xianguo Zhu andWeishang Guo

School of Economics and Management North China Electric Power University Beijing 102206 China

Correspondence should be addressed to Weishang Guo 547180981qqcom

Received 4 January 2018 Revised 4 March 2018 Accepted 29 March 2018 Published 14 May 2018

Academic Editor Gorazd Stumberger

Copyright copy 2018 Shuxia Yang et al This is an open access article distributed under the Creative Commons Attribution Licensewhich permits unrestricted use distribution and reproduction in any medium provided the original work is properly cited

In 2016 the first batch of concentrated solar power (CSP) demonstration projects of China was formally approved Due to theimportant impact of the cost-benefit on the investment decisions and policy-making this paper adopted the static payback period(SP) net present value (NPV) net present value rate (NPVR) and internal rate of return (IRR) to analyze and discuss the cost-benefit of CSP demonstration plants The results showed the following (1)The SP of CSP systems is relatively longer due to highinitial investment but the cost-benefit of CSP demonstration plants as a whole is better because of good expected incomes (2)Vastmajority of CSP projects could gain excess returns on the basis of meeting the profitability required by the benchmark yield of 10(3)The cost-benefit of solar tower CSP technology (IRR of 1233) is better than that of parabolic trough CSP technology (IRR of1172) and linear Fresnel CSP technology (IRR of 1143) (4)The annual electricity production and initial costs have significantimpacts on the cost-benefit of CSP systems the effects of operation andmaintenance costs and loan interest rate on the cost-benefitof CSP systems are relatively smaller but cannot be ignored

1 Introduction

11 Background Concentrating solar power (CSP) is animportant solar energy generation power technology that hasattracted increasing attention in many countries SpainAmerica South Africa India Morocco Italy Greece Portu-gal and others have issued a series of policies to promote thedevelopment of the CSP industry At present only the CSPplants in Spain and the United States realized commercialoperation The cumulative installations of both plants wereabout 4079MW in 2016 accounting for more than 80 ofthe global total installed capacity However the growth ofnew installed capacity of CSP in the United States and Spainstarted to slow down since 2015 due to the cancellation ofpreferential policies The CSP industry is still in the earlycommercialization demonstration stage in some countriesand even in the initial stage in other countries But thosecountries have ambitious plans for the CSP developmentFor example South Africa and Morocco were to installrespectively 33 GW and 2GWCSP plants by 2022 and SaudiArabia planned to install 25GW CSP projects by 2040

As the worldrsquos largest carbon emission country China hasproposed ambitious emission reduction targets In order to

reduce the carbon emission effect of CSP Chinese govern-ment began to pay great attention to the development of CSPindustry According to the 2050 solar roadmapofChina [1] inorder to achieve the large-scale commercialization operationthe development of CSP industry was divided into fourstages namely the initial experimental stage (before 2015)demonstration phase (2015ndash2020) large-scale developmentphase (2020ndash2030) and large-scale commercial developmentstage (2030ndash2050) With the development of CSP its role inthe power system would change from the middle load ofpeak regulation to the power source of basic power load inthe third stage In recent years China has made a series ofpolicy reforms in order to create the CSP Roadmap planFor example in 2016 the CSP installations target of 2020was set to 5GW in Chinarsquos 13th Five-Year electric powerplan Notice on the benchmark feed-in tariff (FIT) policyof CSP was issued by National Development and ReformCommission (NDRC) and the on-grid price was determinedto be RMB115kWh (including tax) [2] The first twenty CSPpilot plants have been approved officially by National EnergyAdministration (NEA) and the total installed capacity was1349MW The pilot projects of CSP will play an importantdemonstration effect for the development of CSP industry in

HindawiJournal of Electrical and Computer EngineeringVolume 2018 Article ID 4063691 11 pageshttpsdoiorg10115520184063691

2 Journal of Electrical and Computer Engineering

ChinaThus it can be expected that the CSP development willenter a rapid development stage in the future

12 Literature Review There are four available technologiesfor CSP namely parabolic trough (PT) linear Fresnel (LF)solar tower (ST) and parabolic dish (PD) The heat transferfluids mainly include water thermal oil molten salt allsolid state concrete and air Over the past few decadesthe thermal oil PT-CSP has been the most commerciallyattractive option among the existing CSP technologies andhas widely been installed in the United States and Spain ST-CSP technology has not been adopted widely in the existingCSP plants but it has a better development potential becauseof the higher thermodynamic efficiency [3 4]Thehigh initialcosts which were estimated to vary between RMB2773Wand RMB5744W (Exchange Rates on Dec 19 2017 $1= RMB6602) have been obstructing the development ofCSP [5] However with the advanced technology and theexpansion of market scale further reductions in the costsof CSP are expected in the future to finally reach a betterpower grid parity than the conventional fossil fuel powertechnologies [6 7]

Different from the photovoltaic (PV) power CSP is able toeffectively solve the issues on the instability and intermittencyof solar energy by installing thermal energy storage (TES)systems The application of TES is of significance for CSPdevelopment and it has been an important research directionin recent years For example Shinnar and Citro (2006)analyzed the prominent impact of TES on CSP systems[8] Tian and Zhao (2013) provided a review for the latestimprovement of the ETS applications [9] Sioshansi andDenholm (2010) researched the profits obtained by CSP withTES in the electricity markets and concluded that TES hasthe potential to add to the values of CSP [10] Madaeni etal (2012) evaluated the cost-benefit of CSP plants with TESand the installation of TES proved to be a reliable option[11] International Renewable Energy Agency (2014) pointedout that CSP plants with TES usually required higher costsbut improved the capacity factor of CSP system resultingin lower levelized cost of energy (LCOE the discounteduniform unit cost of energy in the whole life-cycle) [12]REN 21 (2015) believed that TES has a large cost-reductionpotential and provides a perfect opportunity to overcome theimpediment of high initial investment forCSPplants [13]ThePV-CSP hybrid systems could also reduce the costs of CSPand improve both the reliability and efficiency of CSP systems[14ndash16] Ju et al (2017) held that PV-CSP hybrid system hasseveral advantages compared to the PV-alone or CSP-alonesystems [17] Parrado et al (2016) calculated the LCOE ofPV-CSP hybrid plant based on the Blue Map scenario andRoadmap scenario Between 2014 and 2050 the LCOE valuesobtained varied from RMB097kWh to RMB057kWh andfrom RMB092kWh to RMB051kWh [15] Besides thereare many factors affecting the CSP costs Caldes et al (2009)concluded that the total costs of CSP mostly depended onTES capacity labor costs power plant size and so on [5]Izquierdo et al (2010) studied the effects of solar multiplecapacity factor and TES capacity on the costs of CSP [18]Hernandez-Moro and Martınez-Duart (2012) analyzed the

main factors impacting the CSP costs including cumulativeinstalled capacity electricity production land cost discountrate operation and maintenance (OampM) costs insurancecost and life-time [19]

In view of the importance of cost-benefit to the invest-ment policy-making of power generation industry the cost-benefit analysis has been the research focus of energy elec-tricity industry About the solar power it is divided into threetypes of power generation technologies namely PV powersolar chimney power plant (SCPP one technology for thelarge-scale utilization of solar energy) [20] and CSP (themechanismof a conventional SCPP is as follows [20] sunlighttransmits through the solar collector cover and heats theground below then ambient air enters the solar collector andis heated as it flows along the collector toward its centrewhere a chimney is located then the airflow enters thechimney due to the pressure created by the density differencebetween the warm airflow and ambient cold air finally withthe power conversion unit the kinetic energy of the airflowis transferred into electrical power) PV power has achievedlarge-scale commercial development and its cost-benefit hasbeen discussed widely in large numbers of literatures Forexample Zhao et al (2015) calculated the static paybackperiod (SP) net present value (NPV) and internal rate ofreturn (IRR) of distributed PV plants and found that thecost-benefit of PV power varied widely in different regionswith IRR of about 7ndash21 [21] Yuan et al (2014) adoptedthe LCOE to analyze the economy of the different scaledistributed PV systems and concluded that their LCOEvariedbetween RMB116kWh and RMB129kWh [22] Solar chim-ney power plant (SCPP) is still in the early experiment stagebut some scholars have begun to focus on the cost-benefit ofSCPP For example Li et al (2014) analyzed the cost-benefitof reinforced concrete SCPP by calculating the total NPVof four different phases with the total NPV rate of 0390and held that it has very good application prospect in thefuture [23] Guo et al (2017) estimated the LCOE of the SCPPof RMB04178kWh by taking a 10-MW SCPP of YinchuanChina as an example and concluded that the cost-benefit ofSCPP could compete with the wind power and PV electricity[24] CSP achieved the commercial development in Spain andin the United States but is still in commercialization demon-stration stage in other countries Studies on the cost-benefitof CSPmainly focus on the LCOEAccording to Parrado et al(2016) from 2014 to 2050 the LCOE of CSP decreased fromRMB101kWh to RMB060kWh for the Blue Map scenarioand was between RMB098kWh and RMB050kWh forthe Roadmap scenario [15] Hernandez-Moro and Martınez-Duart (2012) used the life-cycle cost method to discuss theLCOE of CSP in the period of 2010ndash2050 [19] Zhu et al(2015) found that the LCOE values of CSP in China variedbetween RMB12kWh and RMB27kWh [25] while Zhaoet al (2017) pointed out that the LCOE of SCP in Chinawas approximately RMB144kWh [26] It can be seen thatthere were large numbers of investigations discussing thecost-benefit of SCP from the aspect of LCOE but they havenot involved financial indexes such as SP NPV and IRRTherefore this study focused on calculating the static paybackperiod (SP) the net present value (NPV) the net present

Journal of Electrical and Computer Engineering 3

value rate (NPVR) and the internal rate of return (IRR) ofCSP and discussed the sensitivity factors of IRR based on thefirst batch of CSP demonstration projects in order to analyzethe cost-benefit of CSP in China comprehensively

2 Methodology

This research used SP NPV NPVR and IRR to study thecost-benefit of CSP in China For CSP projects the cashoutflows (CO119894) include initial investment (II) operation andmaintenance (OampM) costs insurance expenses loan interestand taxes costs The cash inflows (CI119894) involve electricitygeneration incomes and government tax subsidies (namelyvalue-added tax (VAT) refund) that is

CO119894 = II119894 119894 = 1 1198790(OM + 119868) 119862 + 119877119894 + TAX119894 119894 = 1198790 + 1 119879

CI119894 = (119875 times 119864119894) (1 minus 120572)(1 + 119905VAT) + 120587119894 119894 = 1198790 + 1 119879(1)

where 1198790 and 119879 are respectively construction period andlife-time 119862 represents the construction costs OM is theratio between annual OampM costs and construction costs119868 represents the proportion of annual insurance expensesand construction costs 119877119894 and TAX119894 are respectively annualinterest payments and annual taxes costs 119875 and 119864119894 representthe on-grid price and annual electricity production respec-tively 120572 is the proportion of the self-consumption electricityto total electricity production 119905VAT is added-value tax (VAT)rate 120587119894 represents government tax subsidies

The taxes costs for CSP projects mainly involve incometax and additional taxes that is

TAX119894 = income tax119894 + additional tax119894 (2)

where the income tax can be expressed as

income tax119894

= [(119875 times 119864119894) (1 minus 120572)(1 + 119905VAT) + 120587119894 minus (OampM + 119868) 119862 minus 119877119894 minus DE119894]times 119905income

(3)

where DE119894 is the annual depreciation expense and 119905incomerepresents the income tax rate

VAT is not a cash outflow but directly determines thegovernment tax subsidies and additional taxes According tothe notice of NEA on reducing the tax and fees burdens forthe renewable energy companies CSP in China could enjoythe taxes preference policy to refund 50 of VAT [27] Thuswe can obtain

120587119894 = 50 times VAT119894additional tax119894 = VAT119894 times 119905additional (4)

(1) Payback PeriodThe equation on SP isSPsum119894=1

(CI minus CO)119894 = 0 (5)

The SP can be obtained by calculating the cumulativenet cash flows based on the cash flow statement of CSPproject investment SP is the time point where the cumulativenet cash flows turn from negative value to positive valueEquation (5) can be expressed as

SP = 1198791 minus 1 +10038161003816100381610038161003816sum1198791minus1119894=1 (CI minus CO)11989410038161003816100381610038161003816(CI minus CO)1198791 (6)

where1198791 is the number of years when the cumulative net cashflows are positive or zero for the first time

(2) Net Present Value NPV is the dynamic index to evaluatethe profit ability of CSP project during the calculation periodThe formula of NPV is

NPV = 119879sum119894=1

(CI minus CO)119894 (1 + 119903119890)minus119894+1 (7)

where 119903119890 is benchmark yield or discount rateNPV is the absolute index to evaluate the profit ability

of CSP projects When NPV gt 0 it indicates that CSPprojects could get excess earnings on the basis of meetingthe profitability that is required by the benchmark yield thatis the investment of the CSP projects has strong economicfeasibility If NPV = 0 it illustrates that the CSP projects areonly able to meet the profitability required by the discountrate which means that the investment for the CSP projects isbasically feasible or to be improved while NPV lt 0 indicatesthat the CSP projects cannot achieve the profitability ofbenchmark yield and their investment is not feasible

Besides the magnitude of NPV depends not only on theprofitability but also on the total investment or projects scaleIf NPV gt 0 the NPV is positively correlated with the totalinvestment that is the bigger the total investment the biggerthe NPV If NPV lt 0 the NPV is negatively correlatedwith the total investment Therefore in general NPV cannotbe used to compare the profitability between different CSPprojects

(3) Net Present Value Rate NPVR is the ratio of the NPVof a project to the present value of its total investment Itreflects the unit of investment profitability NPVR can be usedas the auxiliary evaluation index of NPV and evaluate theprofitability between different CSP projects The formula ofNPVR is as follows

NPVR = NPVII119901

II119901 =1198790sum119894=1

II119894 (1 + 119903119890)minus119894 (8)

where II119901 represents the present value of total investment

(4) Internal Rate of Return In the engineering economic anal-ysis IRR is the main dynamic evaluation index to investigatethe profitability of projects IRR reflects the profitability ofthe unrecovered funds occupied by the CSP projects namely


Table 1 Design parameters of CSP demonstration plants

Number Projects DNI(kWhm2yr)

Total investment(million RMB)

Annual powergeneration(GWhyr)

TES capacity TES medium

ST1 [32]Qinghai Delingha 50MWMS ST-CSP

plant 1976 1050 136 6 h MS

ST2 [33] Dunhuang 100MWMS ST-CSP plant 2000 3040 483 11 h MS

ST3 [34]Qinghai Gonghe 50MWMS ST-CSP

plant 1900 1222 1569 6 h MS

ST4 [35] Xinjiang Hami 50MWMS ST-CSP plant 1920 1580 1984 8 h MSST5 [32] Delingha 135MWDSG ST-CSP plant 1900 ndash ndash 37 h MSST6 [36] Gansu Jinta 100MWMS ST-CSP plant 1900 2500 3232 8 h MSST7 [37] Yumen 50MWMS ST-CSP plant 1800 1790 216 9 h MSST8 [38] Yumen 100MWMS ST-CSP plant 1800 3000 388 10 h MSST9 [32] Shangyi 50MWDSG ST-CSP plant 1600 ndash ndash 12 h MS

PT1 [39]Yumen East Town 50MW TO PT-CSP

plant (Royal tech CSP Co Ltd) 1800 134477 1693 9 h MS

PT2 [32] Gansu Akesai 50MWMS PT-CSP plant 20565 1986 256 15 h MS

PT3 [32]Yumen East Town 50MW TO PT CSPplant (Rayspower Energy Group Co

Ltd)1800 ndash ndash 9 h MS

PT4 [40]Urat Middle Banner 100MW TO PT-CSP

plant 2025 2800 350 10 h MS

PT5 [32] Delingha 50MW TO PT-CSP plant 1976 193838 225 9 h MSPT6 [32] Gansu Gulang 100MW TO PT-CSP plant 1913 ndash ndash 7 h MSPT7 [41 42] Zhangjiakou 64MWMS PT-CSP plant 1700 1800 300 16 h MS

LF1 [43]Dacheng Dunhuang 50MWMS LF-CSP

plant 2000 1680 2015 13 h MS

LF2 [32] Zhangbei 50MWDSG LF-CSP plant 1750 ndash ndash 14 h ASSC

LF3 [44 45]Huaqiang Zhaoyang Zhangjiakou 50MW

DSG LF-CSP plant 1750 1800 250 14 h ASSC

LF4 [46]Urat Middle Banner 50MW TO LF-CSP

plant 2025 1476 19588 8 h MS

NoteMS molten salt TO thermal oil ASSC all solid state concrete DSG direct steam generation

the profitability of the projects themselves The higher theIRR the better the economy of projects For CSP projectsIRR is the discount rate that makes the NPV zero and themathematical expression is

NPV (IRR) = 119879sum119894=1

(CI minus CO)119894 (1 + IRR)minus119894+1 (9)

It indicates that the calculation of IRR determined by(9) has to be solved for the higher order equation Thisprocess is very tedious and difficult Therefore in actualprojects the linear interpolation is usually used to calculatethe approximate value of IRR and the linear interpolationformula of IRR is as follows

IRR = 1199031 + NPV (1199031)NPV (1199031) + 1003816100381610038161003816NPV (1199032)1003816100381610038161003816 (1199032 minus 1199031) (10)

where NPV(1199031) gt 0 NPV(1199032) lt 0 1199032 gt 1199031 and the value of(1199032 minus 1199031) should be not more than 2

3 Results and Discussions

31 Data Table 1 displays the basic information on the firsttwenty CSP demonstration projects of China including nineST-CSP projects seven PT-CSP plants and four LF-SCPprojects

According to Table 1 these demonstration projects aredistributed in Gansu Qinghai Hebei Inner Mongolia andXinjiang which are abundant in solar resources The heattransfer fluids include molten salt thermal oil and watersteam with the molten salt and thermal oil primarily TheTESmedium includes molten salt and all solid state concreteTable 1 shows that the initial costs of CSP demonstrationplants vary between RMB210W and RMB397W and theannual effective operation hours change from 2720 h to5120 h due to the impacts of regions conditions directnormal irradiation (DNI) CSP technologies TES capacityand so on (given the lack of design parameters for ST5ST9 PT3 PT6 and LF2 projects the analysis and discussionfor the costs and benefits of CSP will not involve these fiveprojects in the study) Simply from the CSP technologies


perspectives the average TES capacity of ST PT and LR CSPsystems are respectively 8 h 10 h and 12 h Correspondinglythe average initial costs and annual effective operation hoursare RMB286W and 3750 h for ST-CSP systems RMB314Wand 4140 h for PT-CSP systems and RMB330W and 4320 hfor LF-CSP systems Solely from the regions perspectives theaverage TES capacity of CSP systems in Hebei Gansu InnerMongolia and Qinghai is 15 h 10 h 9 h and 7 h respectivelyAccordingly the average initial costs and annual effectiveoperation hours of CSP systems are RMB316W and 4825 hin Hebei RMB307W and 4074 h in Gansu RMB285Wand 3693 h in Inner Mongolia RMB285W and 3693 h inQinghai Thus it can be seen that the TES capacity hascrucial influence on the initial costs and annual electricityproduction of CSP Besides from projects perspectives theTES capacity has also an important impact on the CSPsystems In general the larger the TES capacity the higher theinitial costs and annual electricity generation Taking the ST1project for example the TES capacity is the smallest but boththe initial costs and annual effective operation hours are alsolower than those of other CSP projects For the PT2 projectits TES is higher than that of other CSP projects apart fromthe PT7 project and both its initial costs and annual effectiveoperation hours are the highest

According to the notice on organizing the constructionof CSP demonstration projects the National Energy Admin-istration (NEA) required that the equity capital ratio cannotbe less than 20 the loan rate could be a reference tothe actual commercial loan interest rate the constructionperiod and operation period were set as 2 years and 25 yearsrespectively [28] In 2016 the long-term loan interest rate ofChina was 49 The initial costs are divided into land costand construction costs and the proportions of both costs are4 and 96 respectively [26] Due to no fuel consumptionthe OampM costs are very low and usually account for about2 of construction costs [29] Besides it is necessary for CSPprojects to adopt an insurance measure to decrease the riskscaused by high initial investment and immature technologythe ratio between insurance expense and construction costsis considered to be 05 [14 30]

Theproportion of the self-consumption electricity in totalelectricity production was usually set at 10 both repaymentperiod and depreciation period were 15 years [31] In ChinaCSP demonstration plants could enjoy the income tax con-cession with full exemption in the first three years then it washalf exemption for the income tax in the second three yearsand the income tax rate is reduced from 25 to 15The ratesof value-added tax (VAT) and additional taxes are 17 and8 respectively [22] Therefore this paper could obtain thevalues of parameters and data related to the CSP systems ofChina as described in Table 2

32 Cost-Benefit Evaluation The cost-benefit is to examinethe economic efficiency of CSP projects and it has animportant effect on the investment decisions and policy-making of CSP industry At present the CSP in China hasentered the stage of commercial demonstration developmentThe first CSP demonstration plants of China were approvedformally by theNational EnergyAdministration (NEA)With

Table 2 Parameters values and data related to the CSP systems ofChina

Basic parameter ValuesBenchmark FIT (P) [2] RMB115kWhInitial investment (II) See Table 1OampM costs ratio (OM) [29] 2Operation period (119879 minus 1198790) [29] 25 yearsRepayment period [31] 15 yearsLong-term loan rate (r) 49VAT rate (119905VAT) [22] 17Additional taxes ratio (119905additional) [22] 8Proportion of self-consumption electricity (120572)[31] 10

Annual generation electricity (119864119894) See Table 1Construction costs ratio (C) [26] 96Insurance expenses ratio (I) [14 30] 05Construction period (1198790) [28] 2 yearsDepreciation period [22] 15 yearsDiscount rate (119903119890) [31] 10Income tax rate (119905income) [22] 15Loan ratio [28] 80

the start-up of CSP demonstration projects more and morerenewable energy investors began to pay attention to theCSP development of China The costs and benefits of CSPdemonstration plants have a direct impact on the investorsrsquowillingness to invest in the CSP industry and the results canprovide scientific basis for the policy makers to improve theindustrial policies

The first CSP demonstration projects of China involvedthe ST PT and LF-CSP technologies which are encouragedby NEA [28] Therefore in order to fully analyze the cost-benefit of CSP in China this study selected SP NPV NPVRand IRR as measured indicators to calculate and discuss thecost-benefit of ST PT and LF-CSP technologies respectively

321 Solar Tower CSP Table 3 shows the cost-benefit for theST-CSP demonstration plants of China The SP of ST-CSPprojects vary from 73 years to 164 years Apart from ST2project the SP of other ST-CSP plants are all more than 13years Besides the average SP of ST-CSP technology is about120 years It means that the investors of ST-CSP plants haveto take long time to recover the initial capital due to the hugeupfront investmentTheNPV of ST-CSP systems are betweenRMBndash520 million and RMB6768 million Further analysisshows that the NPV of ST7 project is less than zero and theNPV of the remaining ST plants are all more than zero Itmeans that only the investment for ST7 project cannot meetthe profitability required by the benchmark yield of 10 andother ST-CSP plants are all able to get excess earnings on thebasis of realizing the benchmark profitability

The NPVR of ST-CSP plants are between minus015 and minus111The average NPVR of ST-CSP technology is approximately030 the IRR of ST-CSP systems are between 889 and


Table 3 Cost-benefit for the ST-CSP technology of China

ST1 ST2 ST3 ST4 ST6 ST7 ST8 MeanDNI (kWhm2yr) 1976 2000 1900 1900 1900 1800 1800 ndashInitial costs (RMBW) 21 304 2444 316 25 358 30 ndashTES capacity (h) 6 11 6 8 8 9 10 ndashSP (years) 133 73 137 146 134 164 134 120NPV (Million RMB) 307 6768 267 50 691 minus520 840 ndashNPVR 015 111 011 002 014 minus015 014 030IRR 1114 1922 1085 1012 1108 889 1109 1233

Table 4 Cost-benefit for the PT-CSP technology of China

PT1 PT2 PT4 PT5 PT7 MeanDNI (kWhm2yr) 1800 20565 2025 1976 1700 ndashInitial costs (RMBW) 2690 3972 2800 3877 2813 ndashTES capacity (h) 9 15 10 9 16 ndashSP (years) 145 135 148 176 65 126NPV (Million RMB) 72 499 minus16 minus1150 4930 ndashNPVR 003 013 000 minus030 137 022IRR 1021 1098 998 775 2150 1172

1922 and the average IRR of investment for ST-CSPtechnology is about 1233 Thus it can be seen that the cost-benefit of ST-CSP technology is better since its averageNPVRis more than zero and its average IRR is higher than thebenchmark yield of 10 Further analysis shows that the cost-benefit of ST2 plant with NPVR of 111 and IRR of 1922 isbetter than that of other ST-CSP plants due to higherDNI andlarger TES capacity The ST1 plant is second with NPVR of015 and IRR of 1114 because of its higher DNI and lowerinitial costs The ST8 project is next with NPVR of 014 andIRR of 1109 due to its larger TES capacity followed by theST6 project withNPVR of 014 and IRR of 1108 due to lowerinitial costs The cost-benefit of ST7 project with NPVR ofminus015 and IRR of 889 is the worst of all the ST-CSP projectsbecause of its lower DNI and higher initial costs followed byST4 project with NPVR of 002 and IRR of 1012 becauseof its higher initial costs and finally ST3 project with NPVRof 011 and IRR of 1085 because of smaller TES capac-ity

322 Parabolic Trough CSP Table 4 shows the cost-benefitfor the PT-CSP demonstration plants of ChinaThe SP of PT-CSP projects are between 65 years and 176 years and the SPof other PT-CSP plants are all more than 135 years exceptfor PT7 project In addition the average SP of investment forPT-CSP technology is approximately 126 years and longerthan that of PT-CSP technology Thus it can be seen thatthe investors of PT-CSP plants need to take a longer timeto recover the initial investment The NPV of PT-CSP plantsvary fromRMB-1150 million to RMB4930million in whichthe NPV of both PT4 and PT5 projects are less than zero andthe remaining PT-CSP plants aremore than zero It illustratesthat the investment for both PT4 and PT5 projects cannotmeet the profitability required by the benchmark yield of 10

but PT1 PT2 and PT7 projects could obtain excessive profitsbased on achieving the benchmark profitability

The NPVR of PT-CSP projects vary between minus030and 137 and the average NPVR for PT-CSP technologyis approximately 022 The IRR of investment for PT-CSPprojects are in the range of 775ndash2150 and the averageIRR of investment for PT-CSP technology is approximately1172 It means that the cost-benefit for some PT-CSP plantsis worse but overall it is good for LF-CSP technology becauseits average NPVR is more than zero and its average IRR ishigher than the benchmark yield of 10 Besides the cost-benefit of ST-CSP technology is better than that of PT-CSPtechnology since both the average NPVR and IRR of the ST-CSP are more than that of PT-CSP The cost-benefit of PT7project with NPVR of 137 and IRR of 2150 is better thanthat of other PT-CSPplants because of its larger TES capacityThe PT2 project is the second project with NPVR of 013 andIRRof 1098 due to the higherDNI and larger TES capacityfollowed by PT1 project with NPVR of 003 and IRR of 1021because of the lower initial costs In addition the cost-benefitof PT5 project with NPVR of minus030 and IRR of 775 is thelast of the PT-CSP projects because of its higher initial costsand smaller TES capacity

323 Linear Fresnel CSP Table 5 shows the cost-benefit forthe LF-CSP demonstration plants of China The SP of LF-CSP projects vary between 107 years and 167 years and theaverage SP for LF technology is about 130 yearsThe paybackperiod of LF-CSP technology is longer than that of ST andPT-CSP technologies The NPV of LF-CSP systems are betweenRMB-569 million and RMB1637 million the NPV for LF1project is less than zero and for both LF3 and LF4 plants it ismore than zero It indicates that the investment for LF1 plantcannot achieve the profitability required by the benchmark


Table 5 Cost-benefit for the LF CSP of China

LF1 LF3 LF4 MeanDNI (kWhm2yr) 2000 1750 2025 ndashInitial costs (RMBW) 3360 3600 2952 ndashTES capacity (h) 13 14 8 ndashTES medium M-S A-S-S-C M-S ndashSP (years) 167 107 123 130NPV (Million RMB) minus569 1637 741 ndashNPVR minus017 045 025 018IRR 870 1361 1197 1143

yield of 10 But the investment of LF3 and LF4 plants canobtain excess earnings on the basis ofmeeting the benchmarkprofitability

The NPVR of LF-CSP projects vary from minus017 to minus045and the average NPVR for LF-CSP technology is approxi-mately 018 The IRR of investment for LF-CSP systems varyfrom 870 to 1361 and the average IRR of investmentfor LF-CSP technology is about 1143 Thus it can be seenthat the cost-benefit of LF-CSP technology overall is goodbut worse than that of ST and PT-CSP technologies Furtheranalysis shows that the cost-benefit of LF3 plant with NPVRof 045 and IRR of 1361 is better than that of other twoLF-CSP projects due to the larger TES capacity and theapplication of advanced TES medium (ie all solid stateconcrete) followed by LF4 plant with NPVR of 025 and IRRof 1197 because of the higher DNI and lower initial costsThe cost-benefit of LF1 plant with NPVR of minus017 and IRR of870 is the lowest among all the LF-CSP plants due to thehigher initial costs

33 Sensitivity Analysis The cost-benefit analysis for CSPrequires comprehensively considering the impacts of sensi-tivity factors mainly involving annual electricity productioninitial investment OampM expenses and interest rate Thestudy selected IRR as the evaluation index to discuss theimpacts of these sensitivity factors on the cost-benefit of STPT and LF-CSP technologies respectively and the variationrange is set as plusmn20

331 Annual Electricity Production Figure 1 shows the ef-fects of annual electricity production on the IRR of threedifferent CSP technologies An increase by 20 of the annualelectricity production will cause the IRR to increase from1233 to 1980 for ST-CSP technology from 1172 to1899 for PT-CSP technology and from 1143 to 1860for LF-CSP technology However if the annual electricityproduction is decreased by 20 the IRR of ST PT andLF-CSP technologies will decrease to 538 489 and465 respectively Thus it can be seen that increasingthe annual electricity production could effectively improvethe cost-benefit of CSP systems but reducing it will havea very negative effect on the cost-benefit of CSP systemsTherefore increasing the annual electricity production iscrucial for the improvement of the cost-benefit of CSP sys-tems

4

6

8

10

12

14

16

18

20

IRR

STPTLF

15 10 5 0 minus5 minus10 minus15 minus2020

Figure 1 The sensitivity analysis results of the IRR of CSP to theannual electricity production

The annual electricity production determines the in-comes directly and has an important effect on the cost-benefit Annual electric generation capacity of CSP systemsis determined by the thermal conversion efficiency DNITES capacity and so on For the three CSP technologiesinvolved in the first CSP demonstration projects of China thethermodynamic efficiency of ST-CSP technology is higherthan that of other two CSP technologies in view of thehigher temperatures that the heat transfer fluids in the STsystems could achieve so the ST systems could significantlyincrease the thermal conversion efficiency of ST-CSP plantsin relatively lower costs PT-CSP technology is second Al-though it has been widely adopted among the existing CSPplants its potential for development may be limited by thelow thermodynamic efficiency LF-CSP technology is thesimplified technique of PT-CSP systems and its thermalconversion efficiency is less than that of other two CSPtechnologies meaning that the LF systems need a relativelyhigher cost to increase the thermodynamic efficiency of LF-CSP systems Accordingly the average IRR of investment forST-CSP technology of 1233 is higher than that of PT-CSPtechnology of 1172 and LF-CSP technology of 1143 DNIandTES technology have also important effects on the annualgeneration capacity of CSP Excluding the impacts of otherfactors a higher DNI implies a better electricity production


5

7

9

11

13

15

17

19

21

STPTLF

IRR


Figure 2 The sensitivity analysis results of the IRR of CSP to theinitial costs

of CSP systems in a year So it is necessary for CSP plantsto select the sites with higher DNI in order to increase theannual electricity production and improve the cost-benefitof CSP Besides the installation of TES systems adds to theinitial investment but could improve the capacity factor ofCSP systems and increase the annual electricity production

332 Initial Costs Figure 2 displays the effects of initial costson the IRR of three different CSP technologies When theinitial costs are reduced by 20 the IRR will increase from1233 to 2178 for ST-CSP technology from 1172 to2092 for PT-CSP technology and from 1143 to 2050for LF-CSP technology If increased by 20 the IRR of STPT and LF-CSP technologies will decline to 654 604and 579 respectively Thus it can be seen that the effectsof initial costs reduction on the IRR of CSP are greater thanthat of initial costs increase Reducing the initial costs caneffectively improve the cost-benefit of CSP while its increasehas negative effect on the cost-benefit of CSP Thereforereducing the initial costs is crucial for improving the cost-benefit of CSP systems

High initial investment has been the main obstacle forthe development of CSP As seen in Table 1 the initialcosts of CSP vary between RMB21W and RMB3972W andthey are higher than that of traditional energy generationtechnologies With growth of cumulative installed capacityand technology progress the initial costs of CSP will bereduced greatly in the future [47] On the one hand withthe expansion of projects scale and CSP market larger CSPplants will be designed and constructedThemass productionof the equipment and materials and the optimization of CSPsystems could dramatically reduce the initial costs On theother hand the experience gained by professional technicalpersonnel engineers and contractors through the accumu-lation of the construction of CSP projects will improve thedesign and construction scheme of CSP plants to reducethe initial costs This experience is usually characterized bylearning curves Based on the learning curves theory the

100

105

110

115

120

125

130

135

140

STPTLF

IRR


Figure 3 The sensitivity analysis results of the IRR of CSP to theoperation and maintenance costs

decrease in the initial costs is proportional to the learning ratewith the growth of total installed capacityMore specifically ifthe learning rate of CSP industry is 10 the initial costs couldbe reduced by about 10 when the total installed capacitydouble

333 Operation and Maintenance Costs Figure 3 shows theimpacts of OampM costs on the IRR of three different CSPtechnologies If the OampM costs are increased by 20 the IRRof ST PT andLF-CSP technologieswill decrease from 12331172 and 1143 to 1127 1067 and 1038 respectivelyWhen decreased by 20 the IRR will increase to 1341for ST-CSP technology 1279 for PT-CSP technology and1249 for LF-CSP technology Different from initial invest-ment the OampM costs of CSP systems are relatively lowerbecause of no fuel consumption Accordingly the impacts ofOampM costs on the IRR of CSP systems are relatively smallThe IRR of CSP systems only increase by about 107 whenthe OampM costs are reduced by 20

With the construction and operation of CSP demonstra-tion plants the OampM costs of CSP systems are expected tobe reduced remarkably in the futureTherefore the improve-ment of cost-benefit which is caused by the reduction ofOampM costs should not be ignored

334 Interest Rate Figure 4 shows the impacts of interestrate on the IRR of three different CSP technologies Whenthe interest rate is increased by 20 the IRR of ST PTand LF-CSP technologies will decrease from 1233 1172and 1143 to 1103 1046 and 1018 respectively Ifreduced by 20 the IRR will increase to 1376 for ST-CSPtechnology 1311 for PT-CSP technology and 1280 for LF-CSP technology respectively Although the effects of interestrate on the IRR of CSP systems are relatively low it cannot beignored

CSP is a capital intensive industry The investment andfinancing are crucial to the start-up of CSP projects due tohigh initial costs The long-term commercial loan has beenthe main sources for the funding of CSP projects in China


100

105

110

115

120

125

130

135

140

STPTLF

IRR


Figure 4 The sensitivity analysis results of the IRR of CSP to theinterest rate

and the loans ratio in the total investment could achieve 80Therefore the loan interest is also an important expenditurefor the construction and operation of CSP plantsThe interestrate determines the capitals cost directly and affects the equitycapital benefit The lower interest rate could decrease theloans interest and increase the IRR of CSP plants Thereforepreferential loans play an important role in improving thecost-benefit of CSP technologies In China the low-interestloans can be obtained from policy banks such as Chinainvestment bank and Asian investment bank

4 Conclusions

In 2016 with the implementation of the first batch CSPdemonstration projects China made ambitious developmentgoals for CSP industry The cost-benefit has an importantimpact on the investment discussions and policy-makingthe cost-benefit analysis for CSP demonstration plants istherefore of great significance for the development of CSPindustry in China Based on the related data and designparameters of the first CSP demonstration projects this studyadopted financial indicators including SP NPV NPVR andIRR to calculate and discuss the cost-benefit of different CSPtechnologies in China The results showed the following

Firstly Analysis from Projects Perspective The investmentpayback periods of most of CSP demonstration projects aremore than 13 years meaning that the CSP systems usuallytake a longer time to recover the initial investment becauseof the huge upfront input However with the formulationand implementation of the benchmark FIT of CSP industrythe CSP demonstration projects could obtain good expectedincomes in the operation period so most of CSP projectsare able to gain excess returns on the basis of realizing thebenchmark profitability which is required by the discountedrate of 10 That is under the current technical level policysystem and resource endowment of China vast majorityof CSP projects have a strong economic feasibility Besidesthe cost-benefit among CSP demonstration projects has large

differences due to the combined influence of region condi-tions CSP technologies DNI initial costs TES capacity andso on However generally speaking the larger TES capacityusually could bring a good cost-benefit just from the CSPprojects perspectives

Secondly Calculation from the Perspective of TechnologiesThe average SP of ST PT and LF-CSP technologies areabout 12 years 126 years and 130 years respectively Theiraverage NVPR are respectively 030 022 and 018 Theiraverage IRR of investment are 1233 1172 and 1143respectively This indicates that the cost-benefit of ST-CSPtechnology is better than that of other two CSP technologiesbecause of the higher thermal conversion efficiency closelyfollowed by the PT-CSP technologies which has been widelyadopted among the existing CSP plants The cost-benefitof LF-CSP technology is relatively worse due to the lowerthermodynamic efficiency Thus it can be seen that theimpacts of the types of technology on the cost-benefits of CSPare more important than those of TES capacity

Thirdly Discussions from the Perspective of Influencing FactorsThe annual electricity production and initial costs havesignificant impacts on the cost-benefit of CSP systems Foreach increase of 5 of annual electricity production theIRR can be increased by about 187 for ST 182 for PTand 179 for LF-CSP technologies Conversely their IRRwill be decreased by approximately 174 172 and 170respectively For each decrease of 5 of initial costs the IRRcan be increased by approximately 236 for ST 230 forPT and 227 for LF-CSP technologies Conversely their IRRwill be reduced by about 145 142 and 141 respectivelyBesides the effects of OampM costs and loan interest rate onthe cost-benefit of CSP systems are relatively less than theeffects of the annual electricity production and initial costsbut cannot be ignored especially the loan interest rate

Conflicts of Interest

The authors declare that they have no conflicts of interest

Acknowledgments

This paper is supported by National Social Science Founda-tion (Grant no 16BJY055)

References

[1] Sino-Danish renewable energy development project admin-istration office The China Renewable Energy DevelopmentRoadmap of 2050 [Internet] C2014 National renewable energycenter 2014 httpwwwdocincomp-1151220292html

[2] National Development and Reform Commission (NDRC)NDRC issued ldquoNotice on the benchmark feed-in tariff pricepolicy of CSPrdquo [Internet] C2016 NDRC httpwwwgovcnxinwen2016-0901content 5104496htm

[3] I Purohit P Purohit and S Shekhar ldquoEvaluating the poten-tial of concentrating solar power generation in NorthwesternIndiardquo Energy Policy vol 62 pp 157ndash175 2013


[4] H L Zhang J Baeyens J Degreve and G Caceres ldquoCon-centrated solar power plants review and design methodologyrdquoRenewable amp Sustainable Energy Reviews vol 22 pp 466ndash4812013

[5] N Caldes M Varela M Santamarıa and R Saez ldquoEconomicimpact of solar thermal electricity deployment in Spainrdquo EnergyPolicy vol 37 no 5 pp 1628ndash1636 2009

[6] International Energy Agency (IEA)World energy outlook 2013renewable energy outlook [dissertation] Paris France 2013OGCDIIGA

[7] F Dinter and D M Gonzalez ldquoOperability reliability and eco-nomic benefits of CSPwith thermal energy storage First year ofoperation of ANDASOL 3rdquo in Proceedings of the InternationalConference on Solar Power and Chemical Energy SystemsSolarPACES 2013 pp 2472ndash2481 USA September 2013

[8] R Shinnar and F Citro ldquoA road map to US decarbonizationrdquoScience vol 313 no 5791 pp 1243-1244 2006

[9] Y Tian and C Y Zhao ldquoA review of solar collectors and thermalenergy storage in solar thermal applicationsrdquo Applied Energyvol 104 pp 538ndash553 2013

[10] R Sioshansi and P Denholm ldquoThe value of concentrating solarpower and thermal energy storagerdquo IEEE Transactions on Sus-tainable Energy vol 1 no 3 pp 173ndash183 2010

[11] S H Madaeni R Sioshansi and P Denholm ldquoHow thermalenergy storage enhances the economic viability of concentrat-ing solar powerrdquo Proceedings of the IEEE vol 100 no 2 pp 335ndash347 2012

[12] International Renewable Energy Agency (IRENA) Renewablepower generation costs in 2014 [dissertation] IRENA 2015

[13] Renewable Energy Policy Network for the 21st Century (REN21) The first decade ten years of renewable energy progress2004-2014 [dissertation] REN 21 2015

[14] C Parrado A Marzo E Fuentealba and A G Fernandezldquo2050 LCOE improvement using new molten salts for thermalenergy storage in CSP plantsrdquo Renewable amp Sustainable EnergyReviews vol 57 pp 505ndash514 2016

[15] C Parrado A Girard F Simon and E Fuentealba ldquo2050LCOE (Levelized Cost of Energy) projection for a hybrid PV(photovoltaic)-CSP (concentrated solar power) plant in theAtacama Desert Chilerdquo Energy vol 94 pp 422ndash430 2016

[16] A R Starke JM Cardemil R A Escobar and S Colle ldquoAssess-ing the performance of hybrid CSP + PV plants in northernChilerdquo Solar Energy vol 138 pp 88ndash97 2016

[17] X Ju C Xu Y Hu X Han G Wei and X Du ldquoA review onthe development of photovoltaicconcentrated solar power (PV-CSP) hybrid systemsrdquo Solar Energy Materials amp Solar Cells vol161 pp 305ndash327 2017

[18] S Izquierdo C Montans C Dopazo and N Fueyo ldquoAnalysisof CSP plants for the definition of energy policiesThe influenceon electricity cost of solarmultiples capacity factors and energystoragerdquo Energy Policy vol 38 no 10 pp 6215ndash6221 2010

[19] J Hernandez-Moro and J M Martınez-Duart ldquoCSP electricitycost evolution and grid parities based on the IEA roadmapsrdquoEnergy Policy vol 41 pp 184ndash192 2012

[20] F Cao Q Liu T Yang T Zhu J Bai and L Zhao ldquoFull-yearsimulation of solar chimney power plants in Northwest ChinardquoJournal of Renewable Energy vol 119 pp 421ndash428 2018

[21] X Zhao Y Zeng and D Zhao ldquoDistributed solar photovoltaicsin China Policies and economic performancerdquo Energy vol 88pp 572ndash583 2015

[22] J Yuan S Sun W Zhang and M Xiong ldquoThe economy ofdistributed PV in Chinardquo Energy vol 78 pp 939ndash949 2014

[23] W Li P Wei and X Zhou ldquoA cost-benefit analysis of powergeneration from commercial reinforced concrete solar chimneypower plantrdquo Energy Conversion and Management vol 79 pp104ndash113 2014

[24] P Guo Y Zhai X Xu and J Li ldquoAssessment of levelized cost ofelectricity for a 10-MW solar chimney power plant in YinchuanChinardquo Energy Conversion and Management vol 152 pp 176ndash185 2017

[25] Z Zhu D Zhang P Mischke and X Zhang ldquoElectricity gener-ation costs of concentrated solar power technologies in Chinabased on operational plantsrdquo Energy vol 89 pp 65ndash74 2015

[26] Z-Y Zhao Y-L Chen and J D Thomson ldquoLevelized costof energy modeling for concentrated solar power projects AChina studyrdquo Energy vol 120 pp 117ndash127 2017

[27] CSPPLAZA Notice of NEA on reducing the tax and feesburdens of the companies of renewable energy field [Internet]c2017 CSPPLAZA httpwwwcspplazacomarticle-10455-1html

[28] NEA Notice of NEA on organizing the construction of CSPdemonstration projects [Internet] NEA c2017 httpzfxxgkneagovcnauto87201509t20150930 1968htm

[29] J Hernandez-Moro and J M Martınez-Duart ldquoAnalyticalmodel for solar PV and CSP electricity costs Present LCOEvalues and their future evolutionrdquo Renewable amp SustainableEnergy Reviews vol 20 pp 119ndash132 2013

[30] P Viebahn Y Lechon and F Trieb ldquoThe potential role of con-centrated solar power (CSP) in Africa and Europe-A dynamicassessment of technology development cost development andlife cycle inventories until 2050rdquo Energy Policy vol 39 no 8 pp4420ndash4430 2011

[31] Inner Mongolia Electric Power Survey and Design InstitutePre-feasibility study report on the Inner Mongolia 50MW troughsolar thermal power demonstration project [dissertation] 2008

[32] CSPPLAZA The brief introduction for the first batch twentyCSP demonstration projects [Internet] CSPPLAZA c2016httpguangfubjxcomcnnews20160926775762shtml

[33] Shouhang energy saving co LTD The reply of Shouhang andINDUSTRIAL SECURITIES on ldquoFeedback on the non-publicoffering of shares application documents of Beijing ShouhangIhw Energy Saving Technology Co Ltdrdquo [Internet] Shouhangenergy saving co LTD c2016 httpqstocksohucomcngg0026652279028837shtml

[34] CSPPLAZA Foundation laying for Gonghe 50MWmolten saltST-CSP project of Northwest Institute of survey and design[Internet] CSPPLAZA c2017 httpwwwcspplazacomarti-cle-9937-1html

[35] CSPPLAZA Northwest Electric Power Design Institute wonthe EPC of Hami 50MW ST-CSP project of CHINA POWERENGINEERING [Internet] CSPPLAZA httpwwwcspplazacomarticle-9367-1html

[36] Jinta100MWmolten salt ST-CSP project of ChinaThree GorgesNew Energy Co Ltd [Internet] c2017 httpwwwbidnewscnxiangmuzhaobiao-67992html

[37] CSPPLAZA Yumen Xinneng 50MW molten salt ST-CSPproject obtained the construction permit [Internet] CSP-PLAZA c2017 httpwwwcspplazacomarticle-9536-1html

[38] China state Department of Environmental Protection Envi-ronmental impact assessment report publicity Environmentalimpact assessment report on Yumen 100MW molten salt


ST-CSP project of Guohua [Internet] CSPPLAZA c2017httpwwwdoc88comp-5496378980290html

[39] China state Department of Environmental Protection Envi-ronmental impact assessment report publicity Environmentalimpact assessment report on Yumen East Town 50MW ther-mal oil PT-CSP project [Internet] China state Departmentof Environmental Protection c2017 httpwwwdocincomp-1871037172html

[40] CSPPLAZA WuLate Middle Banner 100MW thermal oil PT-CSP project of China National Nuclear Longtium was startedofficially [Internet] CSPPLAZA c2017 httpwwwcspplazacomarticle-9458-1html

[41] CSPPLAZA Foundation laying for Zhangjiakou 64MWmoltensalt PT-CSP plant of Zhongyang [Internet] CSPPLAZA c2014httpwwwcspplazacomarticle-3735-1html

[42] CSPPLAZA Zhangjiakou 64MW molten salt PT-CSP plantof Zhongyang would be centralized bidding next monthfinancing was almost complete [Internet] CSPPLAZA c2017httpwwwcspplazacomarticle-9397-1html

[43] China state Department of Environmental Protection Envi-ronmental impact assessment report publicity Environmentalimpact assessment report on 50MWmolten salt LF-CSP project[Internet] China state Department of Environmental Protec-tion c2017 httpwwwdocincomp-1910872195html

[44] Hebei peoplersquos government Thirteen projects with a totalinvestment of 45 billion Yuan in Zhangbei were started atthe same time [Internet] Hebei peoplersquos government c2017httpnewsxinhuanetcomlocal2017-0420c 129555705htm

[45] CSPPLAZA The first power generation test on the Conven-tional Island of Zhangjiakou 15MW CSP plant of HuaqiangZhaoyang Energy Co Ltd [Internet] CSPPLAZA c2017 httpwwwcspplazacomarticle-9955-1html

[46] China state Department of Environmental Protection Environ-mental impact assessment report on Inner Mongolia WuLateMiddle Banner 50MW thermal oil LF-CSP project of North-ern United Electric Power [Internet] China state Depart-ment of Environmental Protection c2017 httpwwwdocincomp-1883226646html

[47] China National CSP industry technology innovation strategicalliance Research Report on the CSP industry policy of ChinaSpecial report 3 Analysis for the incentive mechanism of solarthermal power industry in China [Internet] China NationalCSP industry technology innovation strategic alliance c2015httpswenkubaiducomview84d14e9d4a7302768e9939b2html

International Journal of

AerospaceEngineeringHindawiwwwhindawicom Volume 2018

RoboticsJournal of

Hindawiwwwhindawicom Volume 2018


Active and Passive Electronic Components

VLSI Design



Shock and Vibration


Civil EngineeringAdvances in

Acoustics and VibrationAdvances in



Electrical and Computer Engineering

Journal of

Advances inOptoElectronics

Hindawiwwwhindawicom

Volume 2018

Hindawi Publishing Corporation httpwwwhindawicom Volume 2013Hindawiwwwhindawicom

The Scientific World Journal

Volume 2018

Control Scienceand Engineering

Journal of



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SensorsJournal of



RotatingMachinery


Modelling ampSimulationin EngineeringHindawiwwwhindawicom Volume 2018


Chemical EngineeringInternational Journal of Antennas and

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Navigation and Observation


Hindawi

wwwhindawicom Volume 2018

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Submit your manuscripts atwwwhindawicom


ChinaThus it can be expected that the CSP development willenter a rapid development stage in the future

12 Literature Review There are four available technologiesfor CSP namely parabolic trough (PT) linear Fresnel (LF)solar tower (ST) and parabolic dish (PD) The heat transferfluids mainly include water thermal oil molten salt allsolid state concrete and air Over the past few decadesthe thermal oil PT-CSP has been the most commerciallyattractive option among the existing CSP technologies andhas widely been installed in the United States and Spain ST-CSP technology has not been adopted widely in the existingCSP plants but it has a better development potential becauseof the higher thermodynamic efficiency [3 4]Thehigh initialcosts which were estimated to vary between RMB2773Wand RMB5744W (Exchange Rates on Dec 19 2017 $1= RMB6602) have been obstructing the development ofCSP [5] However with the advanced technology and theexpansion of market scale further reductions in the costsof CSP are expected in the future to finally reach a betterpower grid parity than the conventional fossil fuel powertechnologies [6 7]

Different from the photovoltaic (PV) power CSP is able toeffectively solve the issues on the instability and intermittencyof solar energy by installing thermal energy storage (TES)systems The application of TES is of significance for CSPdevelopment and it has been an important research directionin recent years For example Shinnar and Citro (2006)analyzed the prominent impact of TES on CSP systems[8] Tian and Zhao (2013) provided a review for the latestimprovement of the ETS applications [9] Sioshansi andDenholm (2010) researched the profits obtained by CSP withTES in the electricity markets and concluded that TES hasthe potential to add to the values of CSP [10] Madaeni etal (2012) evaluated the cost-benefit of CSP plants with TESand the installation of TES proved to be a reliable option[11] International Renewable Energy Agency (2014) pointedout that CSP plants with TES usually required higher costsbut improved the capacity factor of CSP system resultingin lower levelized cost of energy (LCOE the discounteduniform unit cost of energy in the whole life-cycle) [12]REN 21 (2015) believed that TES has a large cost-reductionpotential and provides a perfect opportunity to overcome theimpediment of high initial investment forCSPplants [13]ThePV-CSP hybrid systems could also reduce the costs of CSPand improve both the reliability and efficiency of CSP systems[14ndash16] Ju et al (2017) held that PV-CSP hybrid system hasseveral advantages compared to the PV-alone or CSP-alonesystems [17] Parrado et al (2016) calculated the LCOE ofPV-CSP hybrid plant based on the Blue Map scenario andRoadmap scenario Between 2014 and 2050 the LCOE valuesobtained varied from RMB097kWh to RMB057kWh andfrom RMB092kWh to RMB051kWh [15] Besides thereare many factors affecting the CSP costs Caldes et al (2009)concluded that the total costs of CSP mostly depended onTES capacity labor costs power plant size and so on [5]Izquierdo et al (2010) studied the effects of solar multiplecapacity factor and TES capacity on the costs of CSP [18]Hernandez-Moro and Martınez-Duart (2012) analyzed the

main factors impacting the CSP costs including cumulativeinstalled capacity electricity production land cost discountrate operation and maintenance (OampM) costs insurancecost and life-time [19]

In view of the importance of cost-benefit to the invest-ment policy-making of power generation industry the cost-benefit analysis has been the research focus of energy elec-tricity industry About the solar power it is divided into threetypes of power generation technologies namely PV powersolar chimney power plant (SCPP one technology for thelarge-scale utilization of solar energy) [20] and CSP (themechanismof a conventional SCPP is as follows [20] sunlighttransmits through the solar collector cover and heats theground below then ambient air enters the solar collector andis heated as it flows along the collector toward its centrewhere a chimney is located then the airflow enters thechimney due to the pressure created by the density differencebetween the warm airflow and ambient cold air finally withthe power conversion unit the kinetic energy of the airflowis transferred into electrical power) PV power has achievedlarge-scale commercial development and its cost-benefit hasbeen discussed widely in large numbers of literatures Forexample Zhao et al (2015) calculated the static paybackperiod (SP) net present value (NPV) and internal rate ofreturn (IRR) of distributed PV plants and found that thecost-benefit of PV power varied widely in different regionswith IRR of about 7ndash21 [21] Yuan et al (2014) adoptedthe LCOE to analyze the economy of the different scaledistributed PV systems and concluded that their LCOEvariedbetween RMB116kWh and RMB129kWh [22] Solar chim-ney power plant (SCPP) is still in the early experiment stagebut some scholars have begun to focus on the cost-benefit ofSCPP For example Li et al (2014) analyzed the cost-benefitof reinforced concrete SCPP by calculating the total NPVof four different phases with the total NPV rate of 0390and held that it has very good application prospect in thefuture [23] Guo et al (2017) estimated the LCOE of the SCPPof RMB04178kWh by taking a 10-MW SCPP of YinchuanChina as an example and concluded that the cost-benefit ofSCPP could compete with the wind power and PV electricity[24] CSP achieved the commercial development in Spain andin the United States but is still in commercialization demon-stration stage in other countries Studies on the cost-benefitof CSPmainly focus on the LCOEAccording to Parrado et al(2016) from 2014 to 2050 the LCOE of CSP decreased fromRMB101kWh to RMB060kWh for the Blue Map scenarioand was between RMB098kWh and RMB050kWh forthe Roadmap scenario [15] Hernandez-Moro and Martınez-Duart (2012) used the life-cycle cost method to discuss theLCOE of CSP in the period of 2010ndash2050 [19] Zhu et al(2015) found that the LCOE values of CSP in China variedbetween RMB12kWh and RMB27kWh [25] while Zhaoet al (2017) pointed out that the LCOE of SCP in Chinawas approximately RMB144kWh [26] It can be seen thatthere were large numbers of investigations discussing thecost-benefit of SCP from the aspect of LCOE but they havenot involved financial indexes such as SP NPV and IRRTherefore this study focused on calculating the static paybackperiod (SP) the net present value (NPV) the net present



2 Methodology


CO119894 = II119894 119894 = 1 1198790(OM + 119868) 119862 + 119877119894 + TAX119894 119894 = 1198790 + 1 119879






income tax119894


(3)





(CI minus CO)119894 = 0 (5)





NPV = 119879sum119894=1

(CI minus CO)119894 (1 + 119903119890)minus119894+1 (7)





NPVR = NPVII119901

II119901 =1198790sum119894=1

II119894 (1 + 119903119890)minus119894 (8)










plant 1976 1050 136 6 h MS



plant 1900 1222 1569 6 h MS








plant 2025 2800 350 10 h MS



plant 2000 1680 2015 13 h MS





plant 2025 1476 19588 8 h MS



NPV (IRR) = 119879sum119894=1





































4

6

8

10

12

14

16

18

20

IRR

STPTLF





5

7

9

11

13

15

17

19

21

STPTLF

IRR






100

105

110

115

120

125

130

135

140

STPTLF

IRR









100

105

110

115

120

125

130

135

140

STPTLF

IRR




4 Conclusions








Acknowledgments


References





















































RoboticsJournal of




VLSI Design



Shock and Vibration







Journal of



Volume 2018



Volume 2018


Journal of




SensorsJournal of



RotatingMachinery





Propagation






Hindawi


Advances in

Multimedia




2 Methodology


CO119894 = II119894 119894 = 1 1198790(OM + 119868) 119862 + 119877119894 + TAX119894 119894 = 1198790 + 1 119879






income tax119894


(3)





(CI minus CO)119894 = 0 (5)





NPV = 119879sum119894=1

(CI minus CO)119894 (1 + 119903119890)minus119894+1 (7)





NPVR = NPVII119901

II119901 =1198790sum119894=1

II119894 (1 + 119903119890)minus119894 (8)










plant 1976 1050 136 6 h MS



plant 1900 1222 1569 6 h MS








plant 2025 2800 350 10 h MS



plant 2000 1680 2015 13 h MS





plant 2025 1476 19588 8 h MS



NPV (IRR) = 119879sum119894=1





































4

6

8

10

12

14

16

18

20

IRR

STPTLF





5

7

9

11

13

15

17

19

21

STPTLF

IRR






100

105

110

115

120

125

130

135

140

STPTLF

IRR









100

105

110

115

120

125

130

135

140

STPTLF

IRR




4 Conclusions








Acknowledgments


References





















































RoboticsJournal of




VLSI Design



Shock and Vibration







Journal of



Volume 2018



Volume 2018


Journal of




SensorsJournal of



RotatingMachinery





Propagation






Hindawi


Advances in

Multimedia









plant 1976 1050 136 6 h MS



plant 1900 1222 1569 6 h MS








plant 2025 2800 350 10 h MS



plant 2000 1680 2015 13 h MS





plant 2025 1476 19588 8 h MS



NPV (IRR) = 119879sum119894=1





































4

6

8

10

12

14

16

18

20

IRR

STPTLF





5

7

9

11

13

15

17

19

21

STPTLF

IRR






100

105

110

115

120

125

130

135

140

STPTLF

IRR









100

105

110

115

120

125

130

135

140

STPTLF

IRR




4 Conclusions








Acknowledgments


References





















































RoboticsJournal of




VLSI Design



Shock and Vibration







Journal of



Volume 2018



Volume 2018


Journal of




SensorsJournal of



RotatingMachinery





Propagation






Hindawi


Advances in

Multimedia































4

6

8

10

12

14

16

18

20

IRR

STPTLF





5

7

9

11

13

15

17

19

21

STPTLF

IRR






100

105

110

115

120

125

130

135

140

STPTLF

IRR









100

105

110

115

120

125

130

135

140

STPTLF

IRR




4 Conclusions








Acknowledgments


References





















































RoboticsJournal of




VLSI Design



Shock and Vibration







Journal of



Volume 2018



Volume 2018


Journal of




SensorsJournal of



RotatingMachinery





Propagation






Hindawi


Advances in

Multimedia



5

7

9

11

13

15

17

19

21

STPTLF

IRR






100

105

110

115

120

125

130

135

140

STPTLF

IRR









100

105

110

115

120

125

130

135

140

STPTLF

IRR




4 Conclusions








Acknowledgments


References





















































RoboticsJournal of




VLSI Design



Shock and Vibration







Journal of



Volume 2018



Volume 2018


Journal of




SensorsJournal of



RotatingMachinery





Propagation






Hindawi


Advances in

Multimedia



100

105

110

115

120

125

130

135

140

STPTLF

IRR




4 Conclusions








Acknowledgments


References





















































RoboticsJournal of




VLSI Design



Shock and Vibration







Journal of



Volume 2018



Volume 2018


Journal of




SensorsJournal of



RotatingMachinery





Propagation






Hindawi


Advances in

Multimedia



















































RoboticsJournal of




VLSI Design



Shock and Vibration







Journal of



Volume 2018



Volume 2018


Journal of




SensorsJournal of



RotatingMachinery





Propagation






Hindawi


Advances in

Multimedia


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