Tag Archives: Economics

Harrison Letter on Viability

John Harrison has recently published an updated AI Viability ReportHis first report was published about a year ago and in it he went through the likely electricity production and the resulting cash flows.  Using reasonable assumptions, his calculations show that this project has a high probability of being a financial loser.

The main difference in this report and the earlier one (aside from updated Provincial numbers) is he lowered the annual decline in performance due to wear and tear, from2% to 1%. Trying to determine the size of this decline has proven to be an interesting exercise, with a fairly wide range of answers.

 

While this improves the project’s prospects, it still makes no economic sense for the developer, Algonquin.

AI – Harrison on Viability

John Harrison has been working on a letter to Algonquin and potential banking backers telling them of all the risks that they ought to consider with the Amherst Island project.  I first posted on his letter here.  Since then he had continued adding to the letter until now it serves as a very nice summation of all of the potential problems association with wind energy projects. Continue reading AI – Harrison on Viability

AI – November 7, 2008

November 7, 2008. We assume Windlectric has submitted their bid to the OPA, but of course nothing is public yet, and won’t be until December or so. In the meantime, John Harrison sent this letter, 0.4mb to the OPA. It outlines some reasons they should carefully evaluate (and in John’s opinion, reject) the bid response from Windlectric. Unfortunately, it seems that the OPA does not have a mandate to be responsive to public comments, per this letter, 8kb. UPDATE – The OPA put out bids for 500mw of renewable power in this RFP, with 1500mw to follow later. There are 38 responses to this RFP and if I guess the average capacity is 100mw only a few of the proposals will be accepted. I’ve been checking the OPA web site for any new news and when I hear I’ll post it here.