Muhammad S 3/11/2014

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Dear

if i do the above setting, in the process capital cost table, does it mean, i should put yearly cost for capital cost recovery/kw instead of total capital cost/kw which will be annualized by LEAP in other case.

Taylor Binnington 3/13/2014
 

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Hi Muhammad,

When selecting Capital cost annualized method: No Annualization, under Basic Parameters: Costing, then you are making the assumption that all capital costs are paid in a single year, without being annualized (equivalently, all capital costs assume 'overnight construction'). This means that the 'Interest rate' variable is ignored, found under Transformation processes.

Instead of entering a yearly cost for capital cost recovery in the 'Capital Cost' variable, you should enter the full capital cost assuming overnight construction.

Hope this helps,

Taylor

Muhammad S 3/17/2014
 

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Thanks Taylor

It means, if i know yearly capital cost recovery for 25 to 30 years life of the project, then I should choose/select the "capital cost recovery factor" and enter the yearly cost data for the life of the project.

Taylor Binnington 3/17/2014
 

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No - when you select 'Capital Cost Recovery Factor' in Basic Parameters, this means that the *full* capital cost (which you enter in the 'Capital Cost' variable for a transformation process) is annualized automatically by LEAP, using the interest rate and lifetime which you provide, according to the capital cost recovery factor method.

I would suggest that you not use your own calculated capital cost recovery factor, but instead allow LEAP to perform the calculation using the lifetime, interest rate, and total capital cost that you enter into the software.

Hope this makes sense,

Taylor