Impact Of Financial Conditions On Optimum Multipurpose Hydro Plant Design
Free (open access)
J. Lopes de Almeida
The design of a multipurpose hydro plant requires the analysis of several subjects related to the hydrological, meteorological, environmental, geological, topographical, structural, electrical, mechanical, operational, social, economic and financial aspects. Once a feasible site and a base scheme are identified, the values of the most significant design decision variables must be found. For under pressure schemes they are usually: dam height; type of turbine; number of units; installed power of each unit; diameters of tunnels and pipes and pipe thicknesses. Due to the considerable number of decision variables and constraints, approaches using mathematical programming optimization techniques have been considered. Yet, from our point of view, these approaches do not fully incorporate the financial aspects. As we believe that these aspects are of great importance in the design optimization process, we have developed an optimization model that performs a financial analysis that takes into account the risk associated with the hydrologic and market variability, the promoter’s capital, the loan interest rate, the repayment period, and the fiscal expenses. Research was done using real data from a Portuguese hydro plant. From the examples in this paper, it can be shown that the financial aspects can have a considerable impact on the optimum multipurpose hydro plant design. Keywords: multipurpose hydro plant design and operation optimization, financial conditions, opportunity cost of capital. 1 Introduction Hydro plants are widespread hydraulic structures that can play an important role in hydroelectric production, electrical power accumulation, irrigation, water supply, flood control, water shortage control, aerial forest firefighting, navigation
multipurpose hydro plant design and operation optimization, financial conditions, opportunity cost of capital.