Documents

Armenia_Methodologies_on_Calculation_of_Tariffs_for_Electric_and_Thermal_Energy_of_Cogeneration_based_on_Useful_Therma.pdf

Description
Attachment To the PSRC Resolution No. 206 N, dated May 4, 2007 Methodologies on Calculation of Tariffs for Electric and Thermal Energy of Cogeneration based on Useful Thermal Demand These Methodologies shall apply to those Licensees having the right of combined generation of electric and thermal energy (hereinafter, the combined generation) and distribution of thermal energy (hereinafter, refer to as the Companies), the generation capacities of which at their cogeneration facil
Categories
Published
of 10
All materials on our website are shared by users. If you have any questions about copyright issues, please report us to resolve them. We are always happy to assist you.
Related Documents
Share
Transcript
  Attachment To the PSRC Resolution No. 206 N, dated May 4, 2007 Methodologies on Calculation of Tariffs for Electric and Thermal Energy of Cogeneration based on Useful Thermal Demand These Methodologies shall apply to those Licensees having the right of combined generation of electric and thermal energy (hereinafter, the combined generation) and distribution of thermal energy (hereinafter, refer to as the Companies), the generation capacities of which at their cogeneration facilities are designed to satisfy the useful demand of heat supply (heat and hot water supply) within the service area and the cogeneration facilities of which are considered highly efficient facilities according to these Methodologies. 1.   Determination of Efficiency of Cogeneration Facilities 1.1.   The following cogeneration facilities are considered highly efficient: 1)   Facilities that ensure at least 10 % saving of primary energy (fuel) as compared to separate generation of thermal and electric energy; 2)   Small (up to 1 electric MW) or micro (up to 150 electric MW) facilities, which are qualified as highly efficient facilities regardless of the level of saving of primary energy. 1.2. The energy conservation indicator of the combined generation shall be calculated by the following formula: ` [ ] %10011  xPEC  SE CE SThCTh η η η η  +−=   in which, PEC – the primary energy conservation indicator (%); CTh η   - the efficiency of thermal energy generation of cogeneration (or absolute efficiency ratio of thermal energy) that is determined as a ratio between the annual production of useful thermal energy and the energy of the primary fuel consumed during the year for generation of thermal and electric energy; STh η   - a base (reference) value of the efficiency of thermal energy separate generation; CE  η   - the efficiency of the combined generation of electric energy (or the absolute electric efficiency ratio), which is determined as a ratio between the annual production of electric energy and the energy of the primary fuel consumed during the year for generation of thermal and electric energy; SE  η   - a base (reference) value of the efficiency of electric energy separate generation.   1.3.   The efficiency indicators for combined generation shall be accepted based on the characteristics of the equipment used at cogeneration facilities, taking into consideration the local climatic and operational conditions of the equipment. 1.4.   The base (reference) values of efficiency of separate generation shall be defined by the PSRC and revised once per four years. 1.5.   The annual quantity of useful thermal energy generated by combined cycle shall be calculated at the entry of the main thermal network and shall not include the thermal energy generated by peak-load water heating boilers. 2.   Principles of Tariff System Development 2.1.   Considering the fact that rehabilitation of district heating of multi-apartment buildings takes place as a competition with various private options of heat supply, the district heating tariffs should be competitive. The specificity and high efficiency of cogeneration allows setting such tariffs for heat supply, which will take into consideration the solvent demand and ensure maximum involvement of customers into this service area. 2.2.   At the first stage of the tariff system development such estimated tariffs for heating and hot water supply shall be defined, which, considering the principles stated in paragraph 2.1. of these Methodologies, will ensure the maximum revenue from heat supply. These tariffs shall be defined based on the market investigations and the experience of using the existing heat supply systems. 2.3.   Based on the estimated tariffs of heat supply set according to the principles stated in Item 2.1. of these Methodologies, such electricity tariffs should be set according to Chapter 3 of these Methodologies, which will allow the company to receive sufficient revenue from sale of electric and thermal energy to be able to cover justified operation and maintenance costs and ensure reasonable return on the attracted capital. These tariffs should not exceed the maximum permitted value defined by the Commission. 2.4.   Only the electric energy is subject to purchase at the electricity tariff estimated in accordance with the principles specified in Item 2.3, which was generated by cogeneration cycle based on the useful heat demand for the given period and then delivered. The electric energy (W e ) shall be determined by the following formula: W e = k ⋅  Q e in which, Q e - the useful thermal energy estimated for the given period according to Item 1.5 of these Methodologies; k – the cogeneration ratio, which is the electric energy specific generation on the basis of the useful thermal energy delivery. It depends on the type of used technological equipment, climatic conditions of installation area and equipment operational conditions and should be defined by the Commission. 2.5.   If the electric energy delivered within the given period (W d ) exceeds the estimated electric energy (W e ), then the difference W c  = W d  - W e  is conventionally assumed the electric energy generated by “condensation” cycle and can be purchased at the tariff-rate  provided for the electricity (AMD/kWth) in the two-part tariff of the TPP closing the annual balance of the electric energy in the given year. That tariff-rate should not exceed the one estimated for the cogeneration. 2.6.   A period of 5 years starting the day of receiving a generation license by companies is considered the heat supply rehabilitation period, during which the entire volume of electric energy delivered by companies (W d ) shall be purchased at the tariff for electric energy generated by cogeneration cycle. 3.   Calculation of the Electric Energy Tariff 3.1.   The tariff for the electric energy generated by cogeneration cycle and delivered to the network shall be defined by financial-economic calculations implemented on the basis of discounted values of financial flows:  == =+−+= miiiniii r CI r FF  NPV  01 0)1()1(  In which, FF i  – the financial flow appeared in the i th year as a result of the main operation of the company, without capital investments implemented in the given year; CI - capital investments implemented in the i th  year; n – a settlement period in years, which is assumed equal to the service life of the main equipment, m – years of implementing capital investments; r – a discount rate, which is assumed equal to the internal rate of return (IRR) permitted by the Commission on the entire attracted capital (own and borrowed); NPV – a net present value of financial flows. 3.2.   In the formula presented in Item 3.1. of these Methodologies the unknown value is the tariff for the electric energy generated by combined cycle, which is chosen to ensure the condition that under permitted discount rate the NPV = 0, which means that the permitted internal rate of return is ensured. 3.3.   The annual financial flows formed as a result of sale of electricity and heat supply services, shall be calculated by the following formula: FF = (R E +R H ) – (OMC +F +T), In which R E  – the company’s revenue from sale of electricity; R H – the company’s revenue from sale of heat supply services OMC – annual justified operation and maintenance costs to generate electric energy and implement heat supply services (without fuel component)  F – the cost of fuel consumed for generation of electric and thermal energy during the year T – taxes subject to payment by the company (except for the VAT). 3.4.   The revenue on sales of electric energy shall be calculated as follows: R E  = W CG T CG  + W C T C  In which, W CG and  W C  – the quantitys of electric energy (kWh) generated and delivered by combined generation and “condensation” cycles, defined pursuant to Items 2.4. and 2.5. of these Methodologies. T CG – the tariff for electric energy generated and delivered by cogeneration cycle (AMD/kWh), which is defined pursuant to Item 3.1. of these Methodologies T C  – the tariff for electric energy generated and delivered by “condensation” cycle, which is defined pursuant to Item 2.5 of these Methodologies. 3.5.   Within 5 years after receiving generation licenses by the companies the revenue received from sale of electric energy shall be defined as follows: R E  = W d  T CG  3.6.   The revenue received from sale of heat supply services shall be defined as follows: R H  = Q H T H  + Q HW T HW In which, Q H – the quantity of thermal energy provided to the customers (consumers) during a year for heat supply (kWh). T H – the average estimated tariff of heating (AMD/kWh). Q HW  – the quantity of thermal energy provided to the customers (consumers) during a year for hot water supply (kWh). T HW - the average estimated tariff of hot water supply (AMD/kWh). 3.7.   The average estimated tariffs for heating and hot water supply present ratio of revenues received from corresponding services and the energy sale and shall be defined based on the principles stated in Item 2.1 of these Methodologies. 3.8.   The operation and maintenance costs (O&M) shall include the following groups of the company’s costs: 1)   Employees payrolls, including social security fund payments; 2)   Costs of materials required for operation; 3)   Cost of purchased electric energy and water required to ensure technological processes; 4)   Costs of repair of combined generation and boiler installations and inter-building and outdoor networks, which shall be included both as those incurred by
Search
Similar documents
View more...
Tags
Related Search
We Need Your Support
Thank you for visiting our website and your interest in our free products and services. We are nonprofit website to share and download documents. To the running of this website, we need your help to support us.

Thanks to everyone for your continued support.

No, Thanks