Comparative Economic Analysis of Gas Fired and Hydroelectric Power Plants In Nigeria
In this Paper, a comparative economic analysis of a presumed 400MW natural gas fired and hydroelectric power plants in Nigeria for a 30 years period was carried out based on real electricity cost model. This was done using Levelized Cost of Electricity (LCOE) and cost estimate for each plant. Plants technical and economic parameters were used to compute Net Present Value (NPV) for each plant capacity which gave -$2,675,510,774 and – $3,730,745,340 for the natural gas fired power plant and the hydroelectric power plant respectively. Other profitability indices such as the Internal Rate of Return (IRR) and Discounted Payback Period (DPP) were computed. The IRR was found to be 13% for the natural gas fired Power plant and 14% for the hydroelectric power plant. The DPP for the natural gas fired power plant was calculated to be 17.48 years while that of a hydroelectric power plant was gotten to be 13.84 years. The study revealed that the economics of any of the two sources of power depends on electricity price, operational cost, and maintenance cost.