I must be missing something here or is someone taking advantage of the crisis situation?
This is a 25 MWe gross combustion turbine. Selling price is about $450 per kWe of capacity.
25,000 kWe x $450 = $11.25M to buy it versus $14.6M to lease it for 1.5 years
Assuming it runs 24/7 the whole time. 1.5 x 365 x 24 x 22,000 kWe (net) = 289,080,000 kWe-Hrs
Cost of the lease per kWe-Hr = $14,600,000.00 / 289,080,000 kWe-Hr = $0.05 per kWe-Hr just for the equipment
The article mentions "Hodge said that last year the PSC authorized a temporary 2.3 cent per kilowatt hour rate increase so WAPA can pay for the lease, but because the temporary new generating unit is more efficient than WAPA's units, which are both decades-old and badly in need of extensive maintenance, the generator lease should be cost-neutral to customers, as fuel savings counterbalance the upfront costs."
If this is such a great deal, why not make it permanent?