Airport Sustainability Plan Economic Analysis

EMGT-6225
Economic Decision Making Term Project

Agenda
Introduction
Scope

Assumptions
Baseline
Vertical wind turbines
Solar panels
Lighting
Qualitative considerations

EMGT-6225
Economic Decision Making Term Project

Introduction
Airport facility (A) operated by State agency (B)
Undergoing a full renovation
Required to fulfill state environmental mandates as well
as own sustainability plan
Economic analysis comparing:
Four lighting alternatives
Two vertical-axis wind turbines
Fixed-angle photovoltaic panels

EMGT-6225
Economic Decision Making - Project

Scope
Economic analysis on renewable power supply and
lighting options to meet the criteria outlined below

Using record data and manufacture technical data

Investment alternatives to be considered mutually
exclusive
Criteria: state mandates require 2.5% of energy for new
construction projects to come from a renewable source
State agencies (B) stainability plan requires a reduction
in energy consumption of 20% from the current baseline

EMGT-6225
Economic Decision Making - Project

Assumptions
12Mph wind speed average is considered as an annual constant
Solar panels are installed at most efficient angle

Shipping, Installation included in initial investment

MARR = 5%, or 10% for finance options composed of:
Expected rate of inflation 5%
Traditional inflation-free rate of interest for risk-free loans 3% 5%
Maintenance is negligible

EMGT-6225
Economic Decision Making - Project

Baseline Analysis
Baseline Energy Cash Flow
0
0

10

15

20

25

-200000
-400000

-600000
-800000
-1000000
-1200000

Present Worth of Baseline: $ (8,820,672.22)

Increase utility rate per year = 3%
Facility energy consumption: 5,525,081 KWhr
Facility energy consumption is considered constant for the planning
horizon of 20 years

EMGT-6225
Economic Decision Making Term Project

Wind Turbine Overview

Pacwind Seahawk Pacwind Delta II

Voltage Output
Current Output
Estimated Energy
Savings/year
Hight
Diameter
Weight
Cost with shiping and
installation

0 - 190 Volts
0 - 20 Amps

0 -120 Volts
0 - 80 Amps

94348.8 KWhr

95472 KWhr

4' Feet
2.5 Feet
60 lbs

14' Feet
13' Feet
200 lbs

$7,000 U.S.

$47,000 U.S.

EMGT-6225
Economic Decision Making Term Project

Wind Turbine Analysis

PW1

PW2

Winner

Wind Seahawk

(9,062,046.40) $ (9,467,253.24) Wind Delta II

Wind Seahawk

Finance Seahawk

(9,118,907.27) $ (9,583,150.78) Finance Delta II

Finance Seahawk

Finance Seahawk

(9,118,907.27) $ (9,062,046.40) no finance seahawk

no finance seahawk

IRR and ERR calculations yielded the same recommendations

EMGT-6225
Economic Decision Making Term Project

Wind Turbine Analysis

Pay back periods without discount factor
$600,000.00

$400,000.00

$200,000.00

$1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43
$(200,000.00)

$(400,000.00)

$(600,000.00)

$(800,000.00)

$(1,000,000.00)
Delta II

EMGT-6225
Economic Decision Making Term Project

Seahawk

Solar Overview

EMGT-6225
Economic Decision Making Term Project

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Solar Analysis
Wind VS Solar
PW1

PW2

Winner

Solar

(9,904,155.41) $ (9,062,046.40) Seahawk

Seahawk

Finance Solar

(10,093,304.84) $ (9,062,046.40) Seahawk

Seahawk

IRR and ERR calculations yielded the same recommendations

EMGT-6225
Economic Decision Making Term Project

11

Solar Analysis
No Discount Payback
$400,000.00

$200,000.00

$0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50
$(200,000.00)

$(400,000.00)

$(600,000.00)

$(800,000.00)

$(1,000,000.00)

$(1,200,000.00)

$(1,400,000.00)

EMGT-6225
Economic Decision Making Term Project

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Lighting Overview

EMGT-6225
Economic Decision Making Term Project

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Lighting Analysis
PW1

PW2

Winner

HID

(7,660,218.11) $ (6,371,965.07) DIM HID

DIM HID

LED

(6,884,959.57) $ (6,371,965.07) DIM HID

DIM HID

DIM LED

(6,538,523.76) $ (6,371,965.07) DIM HID

DIM HID

DIM HID Finance

(6,478,550.19) $ (6,371,965.07) DIM HID

DIM HID

IRR and ERR calculations yielded the same recommendations

EMGT-6225
Economic Decision Making Term Project

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Comparison of Options
Wind Comparisons
PW1
PW2
Winner
Wind Seahawk
$ (9,062,046.40) $ (9,467,253.24) Wind Delta II
Wind Seahawk
Finance Seahawk $ (9,118,907.27) $ (9,583,150.78) Finance Delta II
Finance Seahawk
Finance Seahawk $ (9,118,907.27) $ (9,062,046.40) no finance seahawk no finance seahawk

PW1
HID
$ (7,660,218.11)
LED
$ (6,884,959.57)
DIM LED
$ (6,538,523.76)
DIM HID Finance $ (6,478,550.19)

Solar
Finance Solar

Light Comparisons
PW2
$ (6,371,965.07) DIM HID
$ (6,371,965.07) DIM HID
$ (6,371,965.07) DIM HID
$ (6,371,965.07) DIM HID

Wind VS Solar
PW1
PW2
$ (9,904,155.41) $ (9,062,046.40) Seahawk
$ (10,093,304.84) $ (9,062,046.40) Seahawk

Winner
DIM HID
DIM HID
DIM HID
DIM HID

Winner
Seahawk
Seahawk

Lighting
Renewable
Final Decisions DIM HID
Seahawk
Total investment $ (15,434,011.47)

EMGT-6225
Economic Decision Making Term Project

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Qualitative considerations
Shall not be quantified until a detailed design is done
Size implications of different turbines
Quantity implications of different turbines
Angle of the panels (engineering considerations)

These are not good investments (were looking for the option that
costs us least)
Cost shipping and installation has been factored into the initial
investment cost.

EMGT-6225
Economic Decision Making - Project

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Questions?

THANK YOU

EMGT-6225
Economic Decision Making Term Project

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