- Summary
- Plant capacity degradation calculation

Hello,

I have a simple question and am hoping someone can help. I have a power plant that loses 0.5% production capacity per year for 25 years. When working with the plant capacity in terms of percentages, year 0 is defined as 100% capacity. For year 1 and each subsequent years, is it correct to take the current plant capacity percentage, and multiply it by (100%-0.5%)? Or do I subtract the 0.5% from the previous year?

Plant capacity:

Method 1:

Year 0 = 100%

Year 1 = Year 0 * (100%-0.5%)

Year 2 = Year 1 * (100%-0.5%)

etc

Method 2:

Year 0 = 100%

Year 1 = Year 0 - 0.5%

Year 2 = Year 1 - 0.5%

Thanks.

I have a simple question and am hoping someone can help. I have a power plant that loses 0.5% production capacity per year for 25 years. When working with the plant capacity in terms of percentages, year 0 is defined as 100% capacity. For year 1 and each subsequent years, is it correct to take the current plant capacity percentage, and multiply it by (100%-0.5%)? Or do I subtract the 0.5% from the previous year?

Plant capacity:

Method 1:

Year 0 = 100%

Year 1 = Year 0 * (100%-0.5%)

Year 2 = Year 1 * (100%-0.5%)

etc

Method 2:

Year 0 = 100%

Year 1 = Year 0 - 0.5%

Year 2 = Year 1 - 0.5%

Thanks.