Renewable Energy Project Analysis Course - Module 1 Renewable Energy Project Analysis with RETScreen® Software Renewable Energy Project Analysis Course - Module 1 Energy Model Cost Analysis GHG Analysis Financial Summary Cash Flow Graph © Minister of Natural Resources Canada 2001 – 2002.

Objectives Illustrate role of preliminary feasibility studies Demonstrate how the RETScreen® software works Show how RETScreen® makes it easier to help identify & assess potential projects © Minister of Natural Resources Canada 2001 – 2002.

Development & Engineering Construction & Commissioning Energy Project Implementation Process Pre-feasibility Analysis Feasibility Analysis Development & Engineering Significant barrier RE projects not being considered up-front! Construction & Commissioning © Minister of Natural Resources Canada 2001 – 2002.

Questions What is an acceptable level of accuracy for project cost estimates? How much do these studies typically cost? © Minister of Natural Resources Canada 2001 – 2002.

Accuracy vs. Investment Cost Dilemma $100 to $1,000,000!

When should RE technologies be assessed? Need for energy system New construction or planned renovation High conventional energy costs Interest by key stakeholders Approvals possible Funding & financing accessible Good local RE resource, etc. Pre-feasibility Analysis Feasibility Analysis Preliminary feasibility studies © Minister of Natural Resources Canada 2001 – 2002.

Project Viability (Wind Example) Depends on Several Factors RE resource available at project site (e.g. wind speed) Equipment performance (e.g. wind turbine power curve) Initial project costs (e.g. wind turbines, towers, engineering) “Base case” credits (e.g. diesel generators for remote sites) On-going and periodic project costs (e.g. cleaning of wind turbine blades) Wind Turbine & Tower © Minister of Natural Resources Canada 2001 – 2002.

Project Viability Depends on Several Factors - cont. Avoided cost of energy (e.g. wholesale electricity price) Financing (e.g. debt ratio & length, interest rate) Taxes on equipment & income (or savings) Environmental characteristics of energy displaced (e.g. coal, natural gas, oil, large hydro, nuclear) Environmental credits and/or subsidies (e.g. greenpower rates, GHG credits, grants) Decision-maker’s definition of cost-effective (e.g. payback period, IRR, NPV, RE production costs) © Minister of Natural Resources Canada 2001 – 2002.

Why Use RETScreen®? Simplifies preliminary evaluations Requires relatively small amounts of information Calculates key technical and financial viability indicators automatically Costs 1/10th the amount of other assessment methods Standardized procedures allow objective comparisons Increases potential for successful RE project implementation © Minister of Natural Resources Canada 2001 – 2002.

Mean daily global radiation in the plane of the PV array RETScreen® Validation - Example Accuracy of Solar Resource Tilt-up Model within 7% ! Iqaluit, NT 90º Array Tilt Mean daily global radiation in the plane of the PV array Measured Data Calculated Data Source: Thevenard, et al, 1997

RETScreen® Software Demonstration Generic features Models standardised Cell colour coding On-line manual Product data Cost data & currencies Weather data ground sites satellites Financial analysis method Wind energy project example

Cell Colour Coding © Minister of Natural Resources Canada 2001 – 2002.

Yellowknife School Solarwall Under Construction RETScreen® Software Financial Analysis Method Comparison: Base Case vs. Proposed Case Conventional system vs. renewable energy system Example: Standard building cladding (siding) and a natural gas fired air heater vs. Solarwall cladding with solar air heating plus the conventional natural gas fired air heater Yellowknife School Solarwall Under Construction Photo Credit: Arctic Energy Alliance © Minister of Natural Resources Canada 2001 – 2002.

Software Demo 20 MW Wind Energy Project Input/Output (RETScreen®) Project location: Wind speed: GHG emissions reduction: Wind turbine cost: RE production credit: GHG credit (coal plant): Debt term: Positive cash flow: Return on investment: Scenario #1 (Merchant Plant) Calgary, AB 4.4 m/s 25,123 tCO2/yr $1,200/kW $0/kWh $0/ton 10 years 52 years - 6.4% Scenario # 2 (Green Power Plant) Pincher Creek, AB Lethbridge  7.0 m/s  63,486 tCO2/yr  $1,000/kW  $0.025/kWh  $5/ton  15 years 5.5 years 22.0% © Minister of Natural Resources Canada 2001 – 2002.

Software Demo Scenario 1 (Merchant Plant) Calgary, AB 4.4 m/s $1,200/kW 25,123 tCO2/yr $0/kWh $0/ton 10 years 52 years - 6.4% © Minister of Natural Resources Canada 2001 – 2002.

Software Demo Wind Speed & GHG Emission Reduction Scenario # 1a (Green Power Plant) Pincher Creek, AB Lethbridge  7.0 m/s 63,486 tCO2/yr 18.8 years 4.2% © Minister of Natural Resources Canada 2001 – 2002.

Software Demo Wind Turbine Cost Scenario # 1b $1,000/kW 17.0 years 6.0% © Minister of Natural Resources Canada 2001 – 2002.

Software Demo RE Production Credit Scenario # 1c $0.025/kWh 10.3 years 17.1% © Minister of Natural Resources Canada 2001 – 2002.

Software Demo GHG Emissions Credit Scenario # 1d $5/ton 7.9 years 19.5% © Minister of Natural Resources Canada 2001 – 2002.

Software Demo Debt Term Scenario # 2 15 years 5.5 years 22.0% © Minister of Natural Resources Canada 2001 – 2002.

Questions? © Minister of Natural Resources Canada 2001 – 2002.