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Equations and Variables in the ATB

Calculated Variables Equations

Various equations used in the ATB
Total Battery System Cost equations
Total utility-scale PV plus battery system cost equations

Input Variables

Input Variable Equations

Input variable equations for the ATB

Other Input Variables

Input Variables and Their Values and Definitions 

Input VariableValueDefinition/Description
Construction Duration (C)Varies by technologyNumber of years in construction period
Capacity Factor (CF)Varies by technologyGenerally, the ratio of actual annual output to output at rated capacity for an entire year
Nominal Discount Rate (d)Varies by technologyThe discount rate is a function of the WACC and inflation.
Debt Fraction (DF)Varies by technologyFraction of capital financed with debt; 1-DF is assumed financed with equity.
Expected Market Return on Premium (EMRF)Varies by technologyThe difference between the expected return on a market portfolio and the risk-free rate
Capital Fraction (FC)Varies by technologyFraction of capital spent in each year of construction, 1 to C
Depreciation Fraction (FD)Varies by technologyFraction of capital depreciated in each year, 1 to M
Fixed Operation and Maintenance Expenses (FOM)ATB input ($/MW-year)Annual expenditures to operate and maintain equipment that are not incurred on a per-unit-energy basis
FuelHeat rate (MMBtu/MWh) *Fuel Costs($/MMBtu)Fuel costs, converted to $/MWh, using heat rates
Grid Connection Costs (GCC)Varies by technology ($/kW)Overnight capital cost includes a nominal-distance spur line (<1 mi) for all technologies, and for offshore wind it includes export cable and construction-period transit costs for a 30-km distance from shore. Project-specific costs lines that are based on distance to existing transmission are not included.
Inflation Rate (i)2.5%Assumed inflation rate based on historical data
Depreciation Period (M)Varies by technology (years)Number of years in MACRS depreciation schedule
Overnight Capital Costs (OCC)Varies by technology ($/kW)Capital expenditures if plant could be constructed overnight (i.e., excludes construction period financing); includes onsite electrical equipment (e.g., switchyard), a nominal-distance spur line (<1 mi), and necessary upgrades at a transmission substation
Capital Regional Multiplier (CapRegMult)1Multiplier to account for regional variation in capital costs; not used in the ATB
Rate of Return on Equity (RROE)Varies by technologyAssumed rate of return on the share of assets financed with equity
Economic Lifetime (t) or cost recovery period30 years (default); 20 years and technical life also availableLength of time for paying off assets
Tax Rate (TR)40%Combined assumed marginal state and federal tax rate before application of available federal tax credits for renewable generators
Variable Operation and Maintenance (VOM)Varies by technology ($/MWh)Operation and maintenance costs incurred on a per-unit-energy basis
Year index (y)

Assumptions common to all technologies include the following:

  • Variables are defined in the Financial Definitions worksheet in the ATB data spreadsheet, where two sets of financial assumptions are available in (1) the R&D Only Financial Assumptions Case (R&D Only Case) and (2) the Market + Policies Financial Assumptions Case (Market + Policies Case).
  • Though the tax rate has been updated to include the changes in corporate taxes in the Market + Policies Case, the federal/state blended tax rate is not assumed to vary by technology in our calculations; in practice, depreciation schedules vary by technology based on the tax code.

Developed with funding from the U.S. Department of Energy’s Office of Energy Efficiency and Renewable Energy.

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