Annual working cost of power station (a, b, c)

In the expression Rs $(a + b \cdot \text{kW} + c \cdot \text{kWh})$:

• $a$ = fixed cost that does not depend on demand or energy (organisation, site),
• $b$ = cost per kW of maximum demand (interest and depreciation on plant),
• $c$ = cost per kWh generated (fuel, oil, taxation, operating wages).

Energy generated per year

$$\begin{aligned} \text{Max demand} &= 60\ \text{MW} = 60{,}000\ \text{kW} \\ \text{Units per year} &= 60{,}000 \times 0.5 \times 8760 = 262.8 \times 10^{6}\ \text{kWh} \end{aligned}$$

Constant a

$$a = \text{Rs } 5{,}00{,}000 \ \text{(organisation and interest on site cost)}$$

Constant b

$$\begin{aligned} \text{Interest and depreciation} &= 0.10 \times 5 \times 10^{6} = \text{Rs } 5{,}00{,}000 \\ b &= \frac{5{,}00{,}000}{60{,}000} = \text{Rs } 8.33\ \text{per kW} \end{aligned}$$

Constant c

$$c = \frac{9{,}00{,}000}{262.8 \times 10^{6}} = \text{Rs } 0.003425\ \text{per kWh} \ (\approx 0.34\ \text{paisa/kWh})$$

So the annual cost is Rs $(5{,}00{,}000 + 8.33\,\text{kW} + 0.003425\,\text{kWh})$. At 60 MW and 50% load factor, the total annual cost is 5 + 5 + 9 = Rs 19 lakh.

Answer: a = Rs 5,00,000; b = Rs 8.33/kW; c = Rs 0.003425/kWh.