Economics

The Economics class holds all cost and financial assumptions used in net-present cost calculations.

Fields

Field	Default	Description
`conductors_lifetime`	40 years	Years between conductor replacements
`structures_lifetime`	60 years	Years between structure replacements
`wacc`	0.07	Weighted average cost of capital (7%)
`inflation`	0.02	Annual inflation rate (2%)
`cost_of_losses_dol_per_mwh`	$40/MWh	Cost of energy, used to compute energy lost to resistive and corona losses
`cost_of_congestion_dol_per_mwh`	$1/MWh	Value of energy re-routed due to congestion
`cost_of_structures_dol_per_unit`	$100,000	Generic per-structure cost when `structure_costs_specific_to_conductor=False`

Default Economics

from refa.defaults import default_economics

econ = default_economics()
# conductors_lifetime=40, structures_lifetime=60
# wacc=7%, inflation=2%
# losses=$40/MWh, congestion=$1/MWh, structures=$100k/unit

Custom Economics

from refa import Economics

ec = Economics(
    conductors_lifetime=35,
    structures_lifetime=50,
    wacc=0.09,
    inflation=0.03,
    cost_of_losses_dol_per_mwh=55.0,
    cost_of_congestion_dol_per_mwh=5.0,
    cost_of_structures_dol_per_unit=120_000
)

NPV Methodology

For each year y in the time horizon, costs are discounted and inflated as:

NPV contribution at year y = cost × (1 + inflation)^y / (1 + WACC)^y

Capital costs (conductor and structure) are only incurred in years when a replacement is scheduled:

First conductor replacement: at conductor_remaining_life, then every conductors_lifetime years.
First structure replacement: at structure_remaining_life, then every structures_lifetime years.

Operating costs (losses, congestion) are incurred every year.

All reported net-present cost values are in millions of dollars (mill_dol).