Modelling the competitiveness of first generation commercial OTEC power plants

First generation OTEC plants are expected to be used mainly for baseload electricity generation in the United States Gulf Coast region. In this application, OTEC plants would compete directly with nuclear and coal-fired power plants. The prospective competitiveness of OTEC is evaluated by comparing the delivered cost of electricity generated by the three types of plant for a geographical scenario typical of the region. The comparison is carried out using a modified version of the cost of energy model developed by the Jet Propulsion Laboratory and current estimates of future construction, operating and maintenance costs for the three power plant types. Four main independent variables are considered in this study: OTEC plant capital costs, real fuel escalation rates, real cost of capital resources, and OTEC plant operating capacity factors. The first two factors are found to be prime determinants of OTEC competitiveness. The values commonly forecasted suggest that OTEC plants are likely to deliver electricity at roughly the same cost as nuclear and coal-fired power plants by the year 2000. By contrast, variations in the real cost of capital resources and in OTEC plant capacity factors are found to have only a minor impact on the competitiveness of OTEC with conventional modes of electricity generation.