Temperature - European Investment Bank

WEST AFRICAN POWER POOL (WAPP) PÖYRY ENERGY LTD.
Mount Coffee HPP ESIA and RAP 2012-09-18
ESIA Report Page 203
25.4.5 Comments
Table 25-21: Discount rate 8%, results of the economic analysis
Case NPV EIRR Prod cost
Constr. cost Fuel price Full prod in Mio US $ % US cts/kWh
100% 100% Year 5 287.162 21.38 4.73
100% 100% Year 1 302.438 22.74 4.58
125% 100% Year 5 250.547 17.82 5.91
100% 125% Year 5 380.067 24.90 4.73
The details of the computations are shown in Annexes 25 (Annex 25.9 to 25.12).
The results of the performed economic analyses indicate that for all the studied cases
(Bases Case and Sensitivity Analysis):
� The Net Present Value is positive
� The Economic Internal Rate of Return is higher than 17%
� The cost of the generated electricity comparatively low.
As a summary, the rehabilitation of the Mount Coffee Hydropower Plant is an
economically attractive project.
25.5 Conclusions and Recommendations
25.5.1 Summary of the Results
Within the frame of the preparation of the Environmental and Social Impact Assessment
(ESIA) and the preparation of a Resettlement Action Plan (RAP), an economic analysis
of the Mount Coffee Hydropower Plant Rehabilitation Project was carried out.
For this purpose the latest information and reports were collected in Liberia,
documenting the conditions prevailing in the power market of Liberia and the main
features of the Mount Coffee Hydropower Plant Rehabilitation Project.
The review of the collected material showed that Liberia is in an urgent need for
electricity. Under these circumstances and taking into account that the implementation
of the Mount Coffee Hydropower Plant Rehabilitation will take four to five years, one
can expect that within a short period of time the complete production of Mount Coffee
Hydropower Plant can be absorbed by the consumers of Liberia.
The various possible other options to supply the growing need for electricity were
identified and compared. Mount Coffee Hydropower Plant and HFO thermal power
plant turned out to be the most promising options.
To perform the economic analysis updated information (end of February 2012) on the
Mount Coffee Hydropower Plant Rehabilitation Project could be obtained. Especially
relevant were the mean annual energy production and the construction cost.
The value of the energy generated by Mount Coffee Hydropower Plant was taken as
equal to the unit cost of electricity produced by a HFO thermal plant.