2.6.2. Investment Factors The internal rate of return should be around 35% on 100% of cost and financing may be up to 60% of total project costs. It should be noted that project financing has changed. In the late 1980’s the trend was to finance one credit worthy utility, with one plant. Now there is a trend toward projects with multiple customers. Many “merchant plants” are on drawing board, and these plants have more risk than that which the financing community has in the past been comfortable. 2.7. External Factors Summary Tn addition to prices for competing sources of energy and demand for energy, it is necessary to consider external factors in calculating the total costs and benefits of the production of energy. External factors can be defined as factors that affect costs or benefits, but are not easily traded in markets and/or whose value is difficult to quantify. A space solar power system that meets market needs and generates sufficient revenue to cover its technical and operations costs must also contend with external factors such as concerns about public health and safety and effects on the environment. Health and safety issues relate to the ability of system operators to control direct exposure to a power beam (through exclusion zones, for example), as well as to concerns about the health effects on the population of exposure to low-level microwave radiation. Somewhat different public health and safety issues are associated with different types of space solar systems. Public health and safety effects vary mainly based on the type of power transmission (microwave, laser, and mirror), but may also vary as a function of launch operations and associated terrestrial activities. This analysis is further complicated by the significant uncertainties about the physical environmental effects of a space solar power system. Major uncertainties about the bioeffects of space solar power are summarized in Table 2-7. In addition to public health and safety, environments impacts (both positive and negative) are a major category of externality associated with space solar power when it is compared to conventional energy sources. The environmental impacts of the fabricatioi and launch of a space solar power system, which for some concepts may be significant, must be considere against the reduction in impacts relative to mining or extracting coal or oil and generating pollutants through their use, or even running out of these resources. Space solar power systems may in fact be economically preferable to other alternatives when then- relative contribution to pollution and environmental damage is compared to conventional energy sources. However, a major factor in determining whether this is the case is how these damages are quantified. One method of quantifying these costs is to use the values of the surcharges that are increasingly being Table 2-8 Uncertainties of Space Solar Power
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