Finding (Re)Purpose: The Power of a Pre-Feasibility Analysis in Coal Repurposing

ELECTRICITY SYSTEM ▸ Mitigate impact on electricity While the SPV investors were the system costs primary audience, the transaction needed to be financially viable for the Main metric: Cost of generation Coal Plant Repurposing utility and credible from a climate and Electricity PPA PPA social impact perspective RMI – Energy. [...] 6 The analysis ultimately focused on four accelerated retirement and repurposing scenarios for the case study plant Baseline: Continued operation to end • Plant operated under existing ownership • Used as the base case for comparing electricity generation costs in accelerated retirement of technical life scenarios Transition Scenario 1: Early • Plant retired early under new ownership • After retir. [...] 8 Insight 1: Blended Financing Benefits Early retirement of the plant without repurposing results in net benefits for stakeholders, particularly if blended financing can be secured The PPA tariff required to realize SPV returns is higher than the Blended financing allows the tariff to drop below the business- business-as-usual cost of generation under the original as-usual and market financing cos. [...] 9 USD/MWh Insight 2: Biomass co-firing challenges Co-firing biomass at the case study plant increases overall costs, due to the need to retrofit the system and process fuel ▸ Co-firing the plant to its current technical NPV of SPV costs till early retirement threshold is not (Moderate Cost Scenario) profitable under moderate to high- cost Coal - Capital Costs assumptions. [...] Slide 9: Early retirement of the plant without repurposing results in net benefits for stakeholders, particularly if blended financing can be secured Slide 10: Co-firing biomass at the case study plant increases overall costs, due to the need to retrofit the system and process fuel Slide 11: Solar PV and battery storage offers an upside opportunity, but net profits—and emissions reductions—will de.