Content displaying: CAPEX Definition

Natural Gas Plants

CAPEX Definition

Capital expenditures (CAPEX) are expenditures required to achieve commercial operation in a given year.

Overnight capital costs are modified from Table 123 of the AEO2019 Reference scenario (EIA, 2019a).

EIA reports two types of gas-CT and gas-CC technologies in EIA's Annual Energy Outlook: advanced (H-class for gas-CC, F-class for gas-CT) and conventional (F-class for gas-CC, LM-6000 for gas-CT). Because we represent a single gas-CT and gas-CC technology in the ATB, the characteristics for the ATB plants are taken to be the average of the advanced and conventional systems as reported by EIA. For example, the overnight capital cost for the gas-CC technology in the ATB is the average of the capital cost of the advanced and conventional combined cycle technologies from the Annual Energy Outlook. The EIA only has a single advanced technology for gas-CC-CCS, which we use as the basis for that plant type in the ATB. The CCS plant configuration includes only the cost of capturing and compressing the CO2. It does not include CO2 delivery and storage.

The EIA projections were further adjusted by removing the material price index. The material price index accounts for projected changes in the price index for metals and metals products, and it is independent of the learning-based cost reductions applied in the EIA projections.

Overnight Capital Cost ($/kW)Construction Financing Factor (ConFinFactor)CAPEX ($/kW)
Gas-CT: National-gas-fired combustion turbine $899 1.022$919
Gas-CC: National-gas-fired combined cycle $906 1.022 $927
Gas-CC-CCS: Combined cycle with carbon capture sequestration $2,242 1.022 $2,292
The three gas technologies have the same construction financing factor, which is a simplification to facilitate presentation in the ATB. In reality, gas-CT technologies will generally have a shorter construction schedule (and a construction financing factor less than that in the table), while gas-CC-CCS technologies might have a longer construction schedule (and a higher construction financing factor).

CAPEX can be determined for a plant in a specific geographic location as follows:

CAPEX = ConFinFactor × (OCC × CapRegMult + GCC)
See the Financial Definitions tab in the ATB data spreadsheet.

Regional cost variations and geographically specific grid connection costs are not included in the ATB (CapRegMult = 1; GCC = 0). In the ATB, the input value is overnight capital cost (OCC) and details to calculate interest during construction (ConFinFactor).

In the ATB, CAPEX represents each type of gas plant with a unique value. Regional cost effects associated with labor rates, material costs, and other regional effects as defined by (EIA, 2016) expand the range of CAPEX. Unique land-based spur line costs based on distance and transmission line costs are not estimated. The following figure illustrates the ATB representative plant relative to the range of CAPEX including regional costs across the contiguous United States. The ATB representative plants are associated with a regional multiplier of 1.0.

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R&D Only Financial Assumptions (constant background rates, no tax changes)

References

References are specific to this page, see all references page for all references.

EIA. (2016b). Capital Cost Estimates for Utility Scale Electricity Generating Plants. Retrieved from U.S. Energy Information Administration website: https://www.eia.gov/analysis/studies/powerplants/capitalcost/pdf/capcost_assumption.pdf