Rights Creative Commons: Attribution 3.0 Hong Kong License Cost-benefit Analysis of BOT Power Plants

Abstract: Among non-utility generation, Build-Operate-Transfer (BOT) arrangement has emerged as the dominant form of private investment. Pricing non-utility generation at its avoided cost is the breakeven point for the utility in the cost-benefit analysis. In this paper, a method if calculating the breakeven cost to the utility for BOT plants whose contract lasts for 10-25 years is proposed The proposed approach requires the computation of production costs from long-term generation expansion planning (GEP). To facilitate the inclusion of constraints introduced by BOT plants in GEP, a genetic algorithm approach is utilized in GEP. The breakeven cost is a useful measure in cost-benefit analysis of BOT power plants. An example is presented to illustrate cost-benefit analysis of BOT plants using the concept of breakeven cost