ECONOMIC ANALYSIS:

ALTERNATIVE A:
 Net Installed Capacity cost
= USD cost x PHP conversion X No. of units
= $600,430.00 x 51.62 PHP/$ x 12
= PHP 371,930,359.20
 Net Annual Fixed Capital Cost
= net installed capital cost x Average fixed rate cost
= PHP 371,930,359.20 x .20
= PHP 74,386,071.84
 Net annual operating and maintenance cost
= Operation and maintenance cost per unit x # of units x PHP
conversion
= $480,344 x 51.62 x 12
= PHP 297,544,287.40
 Average load
(𝐴.𝐿 𝑥 𝑤𝑒𝑒𝑘𝑑𝑎𝑦𝑠 𝑥 313 𝑑𝑎𝑦𝑠)+ (𝐴.𝐿 𝑥 𝑆𝑢𝑛𝑑𝑎𝑦𝑠 𝑥 52 𝑑𝑎𝑦𝑠)
= 365
= [(45.13063 x 313) + (44.89879 x 52)]/ 365
= 45.0976 MW
 Average Capacity Factor
= Average Load/Plant Capacity
= (45.0976/66.3432) x 100%
= 67.98 %
 Cost of fuel per Mega joule
= 44.14 PHP/Liter / (SG x Heating Value)
= 44.14 PHP/Liter / (0.885 kg/L (45 MJ/kg))
= 1.1083 PHP/MJ
 Annual fuel and lubrication consumption cost
= Cost of Annual Fuel Consumption+ Cost of Lubrication Oil
= PHP 38,274,095,122.65+ PHP 1,554,822.00
= PHP 38,276,938,105.79

 Cost of Annual Fuel Consumption

𝐴𝑛𝑛𝑢𝑎𝑙 𝑃𝑜𝑤𝑒𝑟 𝑃𝑟𝑜𝑑𝑢𝑐𝑒𝑑
= 𝑥 𝑐𝑜𝑠𝑡 𝑜𝑓 𝑑𝑖𝑒𝑠𝑒𝑙 𝑓𝑢𝑒𝑙 𝑥 𝑢𝑛𝑖𝑡𝑠
𝑆𝑝𝑒𝑐𝑖𝑓𝑖𝑐 𝐹𝑢𝑒𝑙 𝐶𝑂𝑛𝑠𝑢𝑚𝑝𝑡𝑖𝑜𝑛
KWhr
394,858,769.06 𝑝ℎ𝑝
year
= 𝐾𝑊ℎ𝑟 𝑥 44.14 𝑥 12 𝑢𝑛𝑖𝑡𝑠
5.4645 𝐿𝑖
𝐿𝑖
= PHP 38,274,095,122.65

*Annual Power Produced= 394,858,769.06KW-hr/y

*Specific Fuel Oil Consumption= 5.4645 KWhr/Li
  Cost of Lubrication Oil
𝑔 1 𝑘𝑔 𝐾𝑊ℎ𝑟
=0.6 𝐾𝑊ℎ𝑟 x 1000𝑔 x394,858,769.06 x 12 units
𝑦𝑟
= PHP 2,842,983.14

*Annual Power Produced= 394,858,769.06 KWhr/yr

*Specific Fuel Oil Consumption= 0.6 g/KWhr

 Annual Depreciation Cost

= .0933 x Original Cost
= .0933 x 371,930,359.20
= PHP 34,701,102.51
 Total Annual Cost
= (Annual fixed capital cost + Operating and maintenance cost
+ Annual fuel and lubrication cost) – Depreciation Cost
= (74,386,071.84+297,544,287.40+38,276,938,105.79) –
34,701,102.51
= PHP 38,614,167,362.52
 Capitalized Cost
𝑒𝑛𝑔𝑖𝑛𝑒 𝑐𝑜𝑠𝑡
= initial engine cost + (total annual cost)/interest rate + (1+𝑖)𝑘 −1
where i = interest rate = 12 %
k = life of engine in years = 20 yrs.
371,930,359.20
= 371,930,359.20 + (38,614,167,362.52)/0.12 + (1.12)20 −1
= PHP 322,199,674,543.94
ALTERNATIVE B:
 Net Installed Capacity cost
= USD cost x PHP conversion X No. of units
= $667,097.00 x 51.62 PHP/$ x 11
= PHP 378,791,018.5
 Net Annual Fixed Capital Cost
= net installed capital cost x Average fixed rate cost
= PHP 378,791,018.5 x .20
= PHP 75,758,203.71
 Net annual operating and maintenance cost
= Operation and maintenance cost per unit x # of units x PHP
conversion
= $533,677 x 51.62 x 11
= PHP 303,032,474.1
 Average load
(𝐴.𝐿 𝑥 𝑤𝑒𝑒𝑘𝑑𝑎𝑦𝑠 𝑥 313 𝑑𝑎𝑦𝑠)+ (𝐴.𝐿 𝑥 𝑆𝑢𝑛𝑑𝑎𝑦𝑠 𝑥 52 𝑑𝑎𝑦𝑠)
= 365
= [(45.13063 x 313) + (44.89879 x 52)]/ 365
= 45.0976 MW
 Average Capacity Factor
= Average Load/Plant Capacity
= (45.0976/67.5719) x 100%
= 66.74 %
 Cost of fuel per Mega joule
= 44.14 PHP/Liter / (SG x Heating Value)
= 44.14 PHP/Liter / (0.885 kg/L (45 MJ/kg))
= 1.1083 PHP/MJ
 Annual fuel and lubrication consumption cost
= Cost of Annual Fuel Consumption+ Cost of Lubrication Oil
= PHP 35,084,587,195.77+ PHP 2,606,067.88
= PHP 35,087,193,263.65

 Cost of Annual Fuel Consumption

𝐴𝑛𝑛𝑢𝑎𝑙 𝑃𝑜𝑤𝑒𝑟 𝑃𝑟𝑜𝑑𝑢𝑐𝑒𝑑
= 𝑥 𝑐𝑜𝑠𝑡 𝑜𝑓 𝑑𝑖𝑒𝑠𝑒𝑙 𝑓𝑢𝑒𝑙 𝑥 𝑢𝑛𝑖𝑡𝑠
𝑆𝑝𝑒𝑐𝑖𝑓𝑖𝑐 𝐹𝑢𝑒𝑙 𝐶𝑂𝑛𝑠𝑢𝑚𝑝𝑡𝑖𝑜𝑛
KWhr
394,858,769.06 𝑝ℎ𝑝
year
= 𝐾𝑊ℎ𝑟 𝑥 44.14 𝑥 11 𝑢𝑛𝑖𝑡𝑠
5.4645 𝐿𝑖
𝐿𝑖
= PHP 35,084,587,195.77

*Annual Power Produced= 394,858,769.06KW-hr/y

*Specific Fuel Oil Consumption= 5.4645 KWhr/Li
  Cost of Lubrication Oil
𝑔 1 𝑘𝑔 𝐾𝑊ℎ𝑟
=0.6 𝐾𝑊ℎ𝑟 x 1000𝑔 x394,858,769.06 x 11 units
𝑦𝑟
= PHP 2,606,067.88

*Annual Power Produced= 394,858,769.06 KWhr/yr

*Specific Fuel Oil Consumption= 0.6 g/KWhr

 Annual Depreciation Cost

= .0933 x Original Cost
= .0933 x 378,791,018.5
= PHP 35,341,202.03
 Total Annual Cost
= (Annual fixed capital cost + Operating and maintenance cost
+ Annual fuel and lubrication cost) – Depreciation Cost
= (75,758,203.71+303,032,474.10+35,087,193,263.65) –
35,341,202.03
= PHP 35,430,642,739.43
 Capitalized Cost
𝑒𝑛𝑔𝑖𝑛𝑒 𝑐𝑜𝑠𝑡
= initial engine cost + (total annual cost)/interest rate + (1+𝑖)𝑘 −1
where i = interest rate = 12 %
k = life of engine in years = 20 yrs.
378,791,018.50
= 378,791,018.50+ (35,430,642,739.43)/0.12 + (1.12)20 −1
= PHP 295,677,956,800.00
ALTERNATIVE C:
 Net Installed Capacity cost
= USD cost x PHP conversion X No. of units
= $895,000 x 51.62 PHP/$ x 8
= PHP 369,599,200.00
 Net Annual Fixed Capital Cost
= net installed capital cost x Average fixed rate cost
= PHP 369,599,200 x .20
= PHP 73,919,840.00
 Net annual operating and maintenance cost
= Operation and maintenance cost per unit x # of units x PHP
conversion
= $716,000 x 51.62 x 8
= PHP 295,679,360.00
 Average load
(𝐴.𝐿 𝑥 𝑤𝑒𝑒𝑘𝑑𝑎𝑦𝑠 𝑥 313 𝑑𝑎𝑦𝑠)+ (𝐴.𝐿 𝑥 𝑆𝑢𝑛𝑑𝑎𝑦𝑠 𝑥 52 𝑑𝑎𝑦𝑠)
= 365
= [(45.13063 x 313) + (44.89879 x 52)]/ 365
= 45.0976 MW
 Average Capacity Factor
= Average Load/Plant Capacity
= (45.0976/66.336) x 100%
= 67.98 %
 Cost of fuel per Mega joule
= 44.14 PHP/Liter / (SG x Heating Value)
= 44.14 PHP/Liter / (0.885 kg/L (45 MJ/kg))
= 1.1083 PHP/MJ
 Annual fuel and lubrication consumption cost
= Cost of Annual Fuel Consumption+ Cost of Lubrication Oil
= PHP 25,516,063,415.10+ PHP 1,895,322.09
= PHP 25,517,958,737.19

 Cost of Annual Fuel Consumption

𝐴𝑛𝑛𝑢𝑎𝑙 𝑃𝑜𝑤𝑒𝑟 𝑃𝑟𝑜𝑑𝑢𝑐𝑒𝑑
= 𝑥 𝑐𝑜𝑠𝑡 𝑜𝑓 𝑑𝑖𝑒𝑠𝑒𝑙 𝑓𝑢𝑒𝑙 𝑥 𝑢𝑛𝑖𝑡𝑠
𝑆𝑝𝑒𝑐𝑖𝑓𝑖𝑐 𝐹𝑢𝑒𝑙 𝐶𝑂𝑛𝑠𝑢𝑚𝑝𝑡𝑖𝑜𝑛
KWhr
394,858,769.06 𝑝ℎ𝑝
year
= 𝐾𝑊ℎ𝑟 𝑥 44.14 𝑥 8 𝑢𝑛𝑖𝑡𝑠
5.4645 𝐿𝑖
𝐿𝑖
= PHP 25,516,063,415.10

*Annual Power Produced= 394,858,769.06KW-hr/y

*Specific Fuel Oil Consumption= 5.4645 KWhr/Li
  Cost of Lubrication Oil
𝑔 1 𝑘𝑔 𝐾𝑊ℎ𝑟
=0.6 𝐾𝑊ℎ𝑟 x 1000𝑔 x394,858,769.06 x 8 units
𝑦𝑟
= PHP 1,895,322.09

*Annual Power Produced= 394,858,769.06 KWhr/yr

*Specific Fuel Oil Consumption= 0.6 g/KWhr

 Annual Depreciation Cost

= .0933 x Original Cost
= .0933 x 369,599,200
= PHP 34,483,605.36
 Total Annual Cost
= (Annual fixed capital cost + Operating and maintenance cost
+ Annual fuel and lubrication cost) – Depreciation Cost
= (73,919,840.00+295,679,360.00+25,517,958,737.19) –
34,483,605.36
= PHP 25,853,074,331.83
 Capitalized Cost
𝑒𝑛𝑔𝑖𝑛𝑒 𝑐𝑜𝑠𝑡
= initial engine cost + (total annual cost)/interest rate + (1+𝑖)𝑘 −1
where i = interest rate = 12 %
k = life of engine in years = 20 yrs.
369,599,200.00
= 369,599,200.00+ (25,853,074,331.83)/0.12 + (1.12)20 −1
= PHP 215,854,631,848.60
ALTERNATIVE D:
 Net Installed Capacity cost
= USD cost x PHP conversion X No. of units
= $1, 000, 537.00 x 51.62 PHP/$ x 8
= PHP 413,181,759.52
 Net Annual Fixed Capital Cost
= net installed capital cost x Average fixed rate cost
= PHP 413,181,759.52 x .20
= PHP 82,636,351.904
 Net annual operating and maintenance cost
= Operation and maintenance cost per unit x # of units x PHP
conversion
= $800,430 x 51.62 x 8
= PHP 330,545,572.8
 Average load
(𝐴.𝐿 𝑥 𝑤𝑒𝑒𝑘𝑑𝑎𝑦𝑠 𝑥 313 𝑑𝑎𝑦𝑠)+ (𝐴.𝐿 𝑥 𝑆𝑢𝑛𝑑𝑎𝑦𝑠 𝑥 52 𝑑𝑎𝑦𝑠)
= 365
= [(45.10451 x 313) + (44.89879 x 52)]/ 365
= 45.0752 MW
 Average Capacity Factor
= Average Load/Plant Capacity
= (45.0752/73.704) x 100%
= 61.1571 %
 Cost of fuel per Mega joule
= 44.14 PHP/Liter / (SG x Heating Value)
= 44.14 PHP/Liter / (0.885 kg/L (45 MJ/kg))
= 1.1083 PHP/MJ
 Annual fuel and lubrication consumption cost
= Cost of Annual Fuel Consumption+ Cost of Lubrication Oil
= PHP 29,840,036,100.47+ PHP 1,895,322.0915
= PHP 29,841,931,422.5615

 Cost of Annual Fuel Consumption

𝐴𝑛𝑛𝑢𝑎𝑙 𝑃𝑜𝑤𝑒𝑟 𝑃𝑟𝑜𝑑𝑢𝑐𝑒𝑑
= 𝑥 𝑐𝑜𝑠𝑡 𝑜𝑓 𝑑𝑖𝑒𝑠𝑒𝑙 𝑓𝑢𝑒𝑙 𝑥 𝑢𝑛𝑖𝑡𝑠
𝑆𝑝𝑒𝑐𝑖𝑓𝑖𝑐 𝐹𝑢𝑒𝑙 𝐶𝑂𝑛𝑠𝑢𝑚𝑝𝑡𝑖𝑜𝑛
KWhr
394,858,769.06 𝑝ℎ𝑝
year
= 𝐾𝑊ℎ𝑟 𝑥 44.14 𝑥 8 𝑢𝑛𝑖𝑡𝑠
5.4645 𝐿𝑖
𝐿𝑖
= PHP 25,516,063,415.10

*Annual Power Produced= 394,858,769.06KW-hr/y

*Specific Fuel Oil Consumption= 5.4645 KWhr/Li
  Cost of Lubrication Oil
𝑔 1 𝑘𝑔 𝐾𝑊ℎ𝑟
=0.6 𝐾𝑊ℎ𝑟 x 1000𝑔 x394,858,769.06 x 8 units
𝑦𝑟
= PHP 1,895,322.0915

*Annual Power Produced= 394,858,769.06 KWhr/yr

*Specific Fuel Oil Consumption= 0.6 g/KWhr

 Annual Depreciation Cost

= .0933 x Original Cost
= .0933 x 413,181,759.52
= PHP 38,549,858.16
 Total Annual Cost
= (Annual fixed capital cost + Operating and maintenance cost
+ Annual fuel and lubrication cost) – Depreciation Cost
= (74,386,071.84+297,544,287.40+11,001,824,440.00) –
34,701,102.51
= PHP 11,339,053,696.73
 Capitalized Cost
𝑒𝑛𝑔𝑖𝑛𝑒 𝑐𝑜𝑠𝑡
= initial engine cost + (total annual cost)/interest rate + (1+𝑖)𝑘 −1
where i = interest rate = 12 %
k = life of engine in years = 20 yrs.
371,930,359.20
= 371,930,359.20 + (11,339,053,696.73)/0.12 + (1.12)20 −1
= PHP 94,907,060,662.00
CONCLUSION:

As per selection of design, the most economical alternative is the one with the lowest
capitalized cost and must be used for the proposed project. Alternative C has the lowest capitalized
cost which is PHP 215,854,631,848.60; hence, Alternative C must be used.