Suppose that in some location, thermal solar electricity can be produced at a cost of 4¢ per kilowatt hour (kWh), while electricity from coal costs 3.5¢ per kWh (note that thermal solar can be stored up and released overnight, so you can assume that there are no problems with intermittency). Suppose there is enough coal to last 100 more years at current use levels, and suppose for now that virtually all of the cost of making electricity from coal is the coal itself.7 If the real rate of interest is 2%, what do you expect to happen to the current price of coal?
Suppose that in some location, thermal solar electricity can be produced at a cost of 4¢ per kilowatt hour (kWh), while electricity from coal costs 3.5¢ per kWh (note that thermal solar can be stored up and released overnight, so you can assume that there are no problems with intermittency). Suppose there is enough coal to last 100 more years at current use levels, and suppose for now that virtually all of the cost of making electricity from coal is the coal itself.7 If the real rate of interest is 2%, what do you expect to happen to the current price of coal?
Refrigeration and Air Conditioning Technology (MindTap Course List)
8th Edition
ISBN:9781305578296
Author:John Tomczyk, Eugene Silberstein, Bill Whitman, Bill Johnson
Publisher:John Tomczyk, Eugene Silberstein, Bill Whitman, Bill Johnson
Chapter2: Matter And Energy
Section: Chapter Questions
Problem 19RQ: What are the two types of energy most frequently used or considered in this industry?
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Suppose that in some location, thermal solar electricity can be produced at a cost of 4¢ per kilowatt hour (kWh), while electricity from coal costs 3.5¢ per kWh (note that thermal solar can be stored up and released overnight, so you can assume that there are no problems with intermittency). Suppose there is enough coal to last 100 more years at current use levels, and suppose for now that virtually all of the cost of making electricity from coal is the coal itself.7 If the real rate of interest is 2%, what do you expect to happen to the current price of coal?
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