TABLE 4 ESTIMATED IMPACT ON COST OF ELECTRICAL POWER OF ALTERNATIVE ACCOUNTING APPROACHES W/kWM • Estimates of upper bounds to the delivered cost of power from the SPS so that one can assess whether the SPS has any chance of being competitive; • Identification of the cost drivers in the SPS system so that R&D efforts can be properly focussed to reduce the projected costs; • Development of a consistent framework for evaluation of different technological options for the SPS system; • Impacts of SPS requirements on raw materials availability and costs; • Effects of an SPS development program on labor costs and capital markets; and • The cost risks for the SPS reference system and alternative SPS technologies. The approach to cost projections has included descriptive pricing, where a cost goal is set for the SPS system and for specific sub-systems; deterministic pricing, where cost estimating relationships are derived for each sub-system, using engineering judgment based on experience in analogous mature industries to obtain single-point forecasts of future costs which when added together give the overall SPS system costs; and stochastic pricing, which takes explicit account of uncertainties based on component and sub-system probability distributions to establish the overall cost probability distribution for the complete SPS system (but does not adequately reflect unforeseen external events and technical innovations). A convergence of cost projections of the SPS indicates that capital costs would be in the range from $1500 to $3500 per kW. The estimated impacts on cost of electrical power generated by the SPS when compared with coal-fired and nuclear- powered power generation methods using alternative accounting approaches is shown in Table 4. The wide range of costs for a specific energy technology indicates
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