[ExI] Step at a time was economic parable

[BillK]

On Thu, Oct 9, 2008 at 4:13 PM, hkhenson wrote:
<snip>
> So a penny a kWh would generate $800 income over ten years--paying for the
> capital equipment.
>
> It is worth considering what power cost as you raise the lift cost.
>
> For example, at the current cost to GEO of about $20,000/kg, an installed kW
> would cost about $80,000 and the cost per kWh would be a dollar to pay this
> off in ten years.
> Zero lift cost only cuts the price of power in half compared to $100/kg.
>

This sounds a tad simplistic to me.

You have to include the cost of the capital invested.
i.e. pay interest on the money borrowed to invest in this venture.
or a share in the profits of the business to the investors.

The returns generated have to be discounted for inflation.
Though the price of the power sold will possibly increase in line with
inflation, depending on demand and competing alternatives.

I doubt if many venture investors will be happy to suffer losses for
ten years before turning a profit. They could be dead by then, or the
company might go bust.

I probably wouldn't invest in solar panels for my house until the
payoff period was under five years.

BillK