Abstract
With the increasingly prominent problems of resources and environment, thermal power enterprises in China are facing more severe challenges. To improve energy efficiency, a great number of thermal power enterprises implement the technical renovation of equipment. However, current methods cannot meet the needs of scientific and effective evaluations. In this context, the internal rate of return (IRR) is used as the main index to evaluate the economic benefits of the technical renovation of combined heat and power (CHP) plants. In order to improve the accuracy of the economic benefit evaluation results, the incremental cash flow is calculated through the incremental method, which is based on the existence and non-existence method, and the improved factor analysis method is utilized to eliminate the influence of price factors from markets that have no direct and definite relationship with the technical renovation. Then, the evaluation method is validated by taking a CHP technical renovation project in B city of China as an example. By comparing with other methods, the results show that the IRRs calculated by different methods are quite different, and the difference between the maximum and the minimum can reach 69.95%. The result of the method proposed in this paper is more reasonable and reliable and can effectively evaluate the economic benefits of CHP technical renovation projects.
Highlights
With the acceleration of China’s industrialization and urbanization, the continuous upgrading of consumption structure and the rigid growth of energy demand, the problem of resources and environment is still one of the main bottlenecks restricting economic development at present [1]
A: the incremental cash flow is calculated using the incremental method based on the existence and non-existence method—that is, the future cash flow of the project with technical renovation is subtracted from the future cash flow of the corresponding project without technical renovation, but the price factor is not eliminated by the factor analysis method
The internal rate of return (IRR) calculated by method A is the largest, which is 115.64% and much higher than the evaluation standard of the group company; the result calculated by method D is the smallest, which is 45.69%; the results obtained by method B and method C are close, and they are 50.49% and 55.49%, respectively
Summary
With the acceleration of China’s industrialization and urbanization, the continuous upgrading of consumption structure and the rigid growth of energy demand, the problem of resources and environment is still one of the main bottlenecks restricting economic development at present [1]. In order to meet the local heat demand, the two units of the whole plant are all equipped with cogeneration units to provide central thermal energy for winter heating for the residents in the city while providing power for social and economic development. In order to improve the heat supply capacity of Unit 2 and save energy and reduce cost, the thermal power plant carried out the technical renovation
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