The effects of introducing natural gas in the Canary Islands for electricity generation

This study analyses the economic effects of introducing natural gas in the Canary Islands to generate electricity in combined cycle gas turbine (CCGT) plants. To this end we will evaluate how this measure contributes to achieving the objectives of the islands' energy policy and we calculate the cost of generating a kWh from this technology. For this calculation we obtain the net present value (NPV) of the total production costs during the economic lifetime of the plant so as to subsequently find the unitary cost per kWh generated. The result obtained indicates that the kWh cost is some 25% lower than the cost of using petroleum derivatives. Additionally, if we consider the positive effect of CO2 emissions reductions, the cost is 41% lower. The introduction of natural gas will also be a decisive factor in complying with Kyoto requirements and in diversifying supply sources in the Canaries. (c) 2007 Elsevier Ltd. All rights reserved.