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Southern Company Clean Air Act Strategy
Essay specific features
Written by:
Karen B
Date added:
August 12, 2016
Level:
University
Grade:
No of pages / words:
1 / 277
Was viewed:
8691 times
Rating of current essay:
Essay content:
The scrubbers would cost over $719 million over a three year span. And even though you could depreciate the scrubbers over the years, they would have no salvageable value. The second constraint is that there is a 2% revenue reduction due to power for the scrubbers. This cost is enormous, but it is not as substantial as the increase in operating cost for the scrubbers...
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If you produced our expected 21,551 million kilowatt-hours and had an operating cost of 13 cents per kilowatt-hour, you could expect an increase in operating costs of $2,800 million. This cost weighs heavily on your expected returns and inevitably, leaves you operating at a net loss. Even though you can generate some positive cash flow from selling off the excess allowances, it is not enough to offset the large operating costs due to the scrubbers...
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