The Mediterranean Area Renewables Generation Estimation Model 

MARGE is a simple model, programmed in Java, that estimates a yearly cost of constructing CSP plants based on cost data obtained from previous studies into CSP technology, as well as user input parameters such as interest rate and industry growth rate. After a user inputs desired variables, the model 'builds' plants on a yearly basis, evenly dividing the required capacity within the 4 countries in the scenario (Algeria, Libya, Egypt, and Morocco) The model also calculates the amount of HVDC transmission required to transmit the generated power from its location to specified EU tie-in points. Given this data, the scenario calculates the expected cost of building each component, and outputs the resulting cost data to an array. MARGE then calculates the amount of subsidies required over the lifetime of the newly constructed plants to achieve a price parity with coal-fired generation methods. Finally, the model calculates any price reductions gained by an increase in capacity and thus, a realization of learning rates, as well as the projected interest rate for the next year. Then the program loops back, and begins the process again for the new year. The program ends when the unsubsidized price of a unit of CSP generated electricity is equal to low cost coal plants. Additionally, MARGE can calculate the cost of a plant at any given year in a scenario, and output a cost breakdown for that year.

The MARGE UI is designed to be simple and accessible for easy calculations and analysis by various stakeholders. On the left side of the window, the required input data for the scenario is listed. On the right, options for a future plant cost display are listed, and the resulting data is output below. The center of the program is reserved as potential space to display graphical data, a feature not currently enabled. As of this document (9.10.09), the space is held by a diagram displaying a simple overview of the model.

The variables required from the user are listed below as they are found in the program:

Learning Rate: A percentage value, the number input must be a number between 1 and 100. As the capacity of an industry increases, prices decrease. The learning rate describes the degree to which specific costs fall with each doubling in the total installed capacity. Estimates of rates for other electricity generation technologies range between 1.4% for hydropower and 26% for gas turbine combined cycle plants. MARGE enables the user to input any desired learning rate, which will be held constant throughout the scenario.

Starting Interest Rate: A percentage value, the number input must be a number between 1 and 100. Can also be thought of as internal rate of return, the interest rate is the rate of return desired by investors on a project, and is an indicator of perceived risk in the project. Interest rates affect the overall price of electricity, as higher interest rates result in higher overall costs of a project. This in turn increases the LEC of a project. Interest rates for projects typically vary between 5% and 15%. MARGE allows the user to input a desired interest rate, as well as a final interest rate.

Final Interest Rate: A percentage value, the number input must be a number between 1 and 100. The user must input a final or goal interest rate, which is reached at the end of a scenario. Given the input starting and final rates, interest falls each year correlated to the change in LEC from the previous to the current year. If the LEC falls 20% closer to the goal LEC, interest rates also fall 20%.

World Capacity Increase: MARGE allows the user to select the desired world capacity increases per year from 4 radio buttons. The world capacity increase represents the amount of CSP production brought online outside of the Mediterranean / EU area, such as the US, Asia, etc. These capacity increases will not affect the cost of subsidies in the EU area directly, however the increases will lead to faster realization of learning rates. The user may choose between no worldwide capacity growth; growth equal to half of the EU's yearly growth; growth equaling the EU's yearly growth; or growth that is double the amount produced in the EU.

Growth Rate: A percentage value, the number input must be a number between 1 and 100. The user may select the desired growth rate of each scenario by inputting a percentage value into the box labeled growth rate.

Cost of coal: Coal costs are representative of the LEC of coal-fired electricity generation, and the input price determines when CSP technology has reached price parity with coal. The scenario is looped until CSP LECs are less than or equal to coal LECs. A value of Euro cents, the input must be between 0 and 100. For example, a value of .045 euro would be 4.5 euro cents, and would be input as 4.5

Storage Time: The user may input desired amounts of storage to be implemented in CSP plant construction, in the form of a number between 0 and 24. This number represents addition of thermal storage capacity to CSP plants, which store heat energy to be released at a later time, such as in times of limited sunlight, at night, or during periods of cloud cover. Each hour of storage represents one hour that the plant is able to operate at its design generation capacity.

Cost in Year: This input box allows the user to enter a year in which they would like to display a breakdown of plant costs, in millions of Euros. The number must be any number after 2010. If the year is outside the bounds of the scenario, that is, after plants reach price parity, no calculations will be displayed, so it is recommended that users first calculate their desired scenario, and then input the desired plant cost information.

Plant Type: Users may select whether they wish to display costs for a parabolic trough type plant, or a power tower plant.

Plant Size: The user must input a desired plant size for the sample plant, in megawatts

To calculate a scenario, users input data into each section and press the "Run Scenario" button. To calculate the costs of a sample plant in a given year, users press the "Calculate" button. To exit, simply press the "Exit" button.

Model Overview