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Assessment of the Costs of Geothermal Power Generation in New Zealand 6.6.3 Total O&M Costs Combining O&M costs from the three sections above gives the following overall O&M costs from which it can be seen to range from 1.5 to 2.0 NZ cent.kWh-1 for 50 and 20 MW developments respectively. Table 6-8 Total Geothermal Project O&M Costs In addition to these fixed and variable costs there are additional planned maintenance costs associated with regular major overhauls which include statutory inspections. These costs are estimated at 150,000 NZD per overhaul for a 20 MW plant and 200,000 NZD for a 50 MW plant. The frequency of such inspections varies from one plant to another but is generally once every three years. A final cost category related to stocks and costs of consumables has been allowed for at 10% of total O&M costs. 6.7 Commercial Costs Commercial costs associated with developments also need to be included in costing a geothermal project. These include financing charges (including establishment costs and interest), interest during construction, corporate overhead, legal costs, insurances, and the like. Due allowance needs to be made for these in the financial analysis. These costs are discussed in more detail in Section 8. 6.8 Cost Sensitivities 6.8.1 Sensitivity to Drilling Success Drilling success is of considerable importance to project development costs and overall economics. If the resource is well understood, and conditions are favourable, drilling success rates of 70% or more may be achieved (including exploration wells), resulting in lower total drilling costs for a given size of project. In the New Zealand geothermal environment, success rates by private sector developers are generally higher than this due to the considerable Crown legacy in exploration drilling and resource proving which removes much of the well success risk on the private sector (see Section 4 for further discussion on this). For the purposes of this study, the low and high envelope well Sinclair Knight Merz Steam field O&M NZD.yr‐1 $ 600,000 $ 1,600,000 20 MW plant NZD.kWh ‐1 $ 0.004 $ 0.010 NZD.kWe ‐1 $ 30 $ 80 NZD.yr‐1 $ 1,500,000 $ 2,400,000 50 MW Plant NZD.kWh ‐1 $ 0.004 $ 0.006 NZD.kWe ‐1 $ 30 Power Plant O&M TOTALS $ 2,200,000 $ 0.014 $ 110 $ 3,900,000 $ 0.010 $ 50 $ 80 SKM Cost of Geothermal Power Report (2007 Cost Basis)R1.doc PAGE 35PDF Image | Current Costs of Geothermal Power Generation in New Zealand
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