Economic Analysis of Heat Exchanger for a Simple Cycle Gas Turbine Power Plant

Abstract

This study undertakes a comprehensive economic analysis of integrating a heat exchanger with a simple cycle gas turbine power plant, with a specific focus on the Siemens SGT5-2000E gas turbine model. The analysis leverages on key parameters such as Net Present Value (NPV), Internal Rate of Return (IRR), Payback Period (PBP) and Levelized Cost of Electricity (LCOE), to evaluate the viability and profitability of the investment. The results of the analysis show that integrating a heat exchanger with the gas turbine power plant yields a positive NPV of N166,031,518.3, signifying that the investment is profitable. Furthermore, the IRR is approximately 12.22 %, which is the discount rate at which the NPV becomes zero. The payback period is determined to be 7.7 years, indicating that the investment will break-even within a reasonable timeframe. Additionally, the levelized cost of electricity is calculated to be N65.23/kWh, which corresponds to a discount rate of 55 %. The findings of this study provide valuable insights for investors, policymakers, and plant operators seeking to optimize the efficiency and competitiveness of gas turbine power plants. Overall, the results suggest that integrating a heat exchanger with a simple cycle gas turbine power plant is a viable and profitable investment opportunity.