So, the fixed manufacturing costs amount to 7,7 M$/year for the traditional plant and textbf11 M$/year for the CLC one.
Finally, the last contribution to the OPEX is represented by the so called “General Ex-penses”, that comprise the costs for:
• Administration, that stand for about 17,7 % of the CL plus 0,9 % of FCIL;
• Distribution and selling, that stand for about 1,1 % of total direct manufacturing costs;
• Research and development, that stand for about 5 % of total direct manufac-turing costs.
The general expenses result thus to be equal to 11 M$/year for the traditional plant and 14,9 M$/year for the CLC one.
Each contribution of fixed manufacturing costs and general expenses, for both plants, is reported in Appendix B, tables 33 and 34.
In last analysis, it was considered also the presence of the carbon tax, in an European location, for the traditional plant that is the only one that emits CO2 in the atmosphere.
Considering the data and the trends of the energy perspectives of IEA in 2016 [4], it was possible to extract an average value of carbon tax to be applied to the traditional plant, equal to 32,8 $/ton. Thus, by simply extracting the flowrate of CO2 leaving the plant and multiplying it for the annual operation hours, the total quantity of CO2 emitted can be calculated, and consequently the costs associated to carbon tax (6,93 M$/year).
In the end, the final OPEX was estimated to amount to 165,5 M$/year for the tradi-tional plant and 213,4 M$/year for the CLC one.
5.3 Cash Flow Analysis
that can be obtained by H2 selling amount, indeed, to 345,6 M$/year, for both plants.
At this point, yearly cash flow needs to be evaluated. Cash flow can be easily defined as the difference between all the costs and the incomes; obviously, at year 0 there are no rev-enues and only the investment costs is present, while starting from year 1 the OPEX costs and revenues are considered. Moreover, if the cash flow is positive, taxes are imposed on that. So, making the assumption that the plant could be located in Italy, the taxation rate that needs to be assumed is related to IRPEF different aliquots. In this specific case, since revenues are so high, taxation rate t can be approximated with a single fixed one, relative to the maximum band (over 75ke) that amounts to t= 43 % [81]. Thus, the cash flow can be expressed as:
Cash F low M $ year
= Incomes − Costs − T axes
Incomes − Costs − t · (Incomes − Costs − Dep rate)
(77)
for the first 10 years, where depreciation is present, and as:
Cash F low M $ year
= Incomes − Costs − T axes
Incomes − Costs − t · (Incomes − Costs)
(78)
for the remaining years. The lifetime of the plants was supposed equal to 25 years [41].
After that, it is necessary to understand how to estimate the present cash flow of a predicted cash flow in the future. This can be done by taking into consideration the value of money in time, by means of the discount rate i. In this analysis, the discount rate can be approximated with the Weighted Average Cost of Capital (WACC), that is determined on the basis of the financial structure chosen for the investment. The financial structure basically depends on:
• The type of the investor, that can be nor Investor-Owned Utility (IOU) or Indepen-dent Power Producer (IPP);
• The risk of the investment, that can be lower or higher depending on the maturity of the technology in the market.
Since the plants can be seen as inserred in a wider network of energy infrastructure, an IOU investor was chosen for both plants. On the other hand, due to the higher maturity of the traditional plant with respect to CLC one, the risk associated to that investment is lower than in CLC, and this is reflected on the financial structures themselves. The WACC is determined by means of a weighted average on cost of equity (CE) and cost of debt (CD), as follows:
W ACC = %ECE + %DCD (79)
where all the parameters depend on the financial structure chosen. Moreover, taxation rate needs to be applied to the cost of debt to obtain the after tax WACC, as follows:
Af ter T ax W ACC = %ECE+ %DCD· (1 − t) (80) So, in the end the after tax WACC resulted to be 5,67 % for the traditional plant and 6,24 % for the CLC one. Details of the financial structures used for WACC calculation were taken by NETL [73] and are reported in Appendix C, tables 35 and 36.
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At this point, the Net Present Value (NPV) can be evaluated with the following relation-ship:
N P V (τ ) = −I +
τ
X
n=1
Bn
(1 + W ACC)n (81)
where I is the investment cost, coincident with the CAPEX, n are representative of the years, and Bn is the cash flow at year n. The resulting NPVs for both plants, over their whole lifetime, is shown in figure 68, while puntual values for each year are reported in appendix C, table 37.
Figure 68: NPV comparison, Traditional and CLC plants
As can be easily seen, the investment seems to be very promising, since it is recovered very quickly. Thus, together with NPV at final operational year of the plant, the so called Payback Time (PBT), that is the time at which NPV=0 and so the investment is recovered, is considered as key indicator of the quality of the investment. Both are reported in figure 69.
Figure 69: NPV at 25 years and PBT comparison, Traditional and CLC plants
5.3 Cash Flow Analysis
As expected, the traditional SMR plant allows higher earnings and lower PBT with respect to CLC one. CLC plant has a reduction of about 34% of the NPV at 25 years (860 M$
against 1300 M$ of the tradtional one), while the PBT results to be 1.4 years against 0.8 of the traditional.
Finally, it can become useful to analyze the cost of production of H2 for both plants, in order to have another indicator. The most proper one for this purpose results to be the Levelized Cost Of Hydrogen (LCOH), that can be expressed as [41]:
LCOH
$ kgH2
= Annual Capital Cost + Operational Cost
Annual H2P roductivity (82)
The Annual Capital Cost (ACC) can be calculated as follows:
ACC = CRF · CT otal (83)
where CT otal is the total investment cost (TOC), while Capital Recovery Factor (CRF) is an indication of the different value of investment during lifetime of the plant, and is defined as:
CRF = i(1 + i)n
(1 + i)n− 1 (84)
where i is the discount rate, coincident with after tax WACC, and n is the lifetime of the plant (25 years in this case).
The resulting LOCHs are shown in figure 70.
Figure 70: LCOH comparison between traditional and CLC plant As expected, LCOH is higher in CLC plant (3,7 against 2,97
$ kgH2
of the traditional one), mainly due to the higher external resources needed to properly work.
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