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The capital cost of a piston engine power plant generally depends on unit size. Small engines are generally mass produced and cheaper than their larger relatives. However this is often offset by higher installation costs. Thus typical total plant costs for a 100 kW generator unit is $1515/kW while a 5000kW installation costs $919/kW.8

While plants in the 100-5000 kW capacity range are based on standard components, large piston engine power plants generally have a cost structure more like that of a gas turbine power plant. Table 6.3 lists the costs of a number of large diesel-engine-based power stations. These plants were built in different countries, using different engine configurations, and yet the unit cost of the plants all fall within a remarkably narrow range of $1100-1300/kW.

Maintenance costs vary with engine size and type. Small, high-speed engines generally require the most frequent maintenance while larger engines can run for much longer periods without attention. Engine oil

Table 6.3 Typical large diesel power plant costs









Kohinoor Energy, Pakistan





Gul Ahmed Energy Co,





Pakistan, Jamaica

Energy Partners





APPL, Sri Lanka





IP, Tanzania





Kipevu 2, Kenya





Source: Modern Power Systems.

Source: Modern Power Systems.

monitoring systems are often used, particularly in large engines, to monitor wear rates. The US EPA found that maintenance cost varied between $0.007/kWh and $0.02/kWh for engines in the 100kW-5000kW range, with the smallest engines incurring the highest costs.9

Capital cost is a significant factor in the cost of electricity from a piston-engine power plant but the fuel cost is normally more important. On a cost per kWh basis, gas engines up to 5 MW will normally be able to compete with gas turbine units of similar size, the higher efficiency of the reciprocating engine in simple cycle mode providing a slight edge in many cases. Such engines are becoming increasingly popular for distributed generation applications. The advantage of reciprocating engines may extend to engines of up to 50 MW in capacity under certain conditions. For example, where the power plant is required to load follow, or at high altitude, the reciprocating engine has a significant advantage.

Diesel engines have a long history of use in supplying power to remote communities or isolated commercial facilities. Generation costs under these circumstances can be high as the fuel has to be shipped to the site, adding transport costs. Often, although, the diesel unit is the only viable source of power. Renewable energy systems such as wind, solar and small hydropower now offer an alternative to diesel in some cases.

Large, slow-speed diesel engines burning poor quality residual oil are generally a cost-effective source of electricity provided the fuel is available. Their use is, however, restricted by fuel supply.

The other major application of piston engines is for combined heat and power. Where there is a use for the heat supplied by a unit, this is normally an extremely cost-effective option. Such considerations are also encouraging the installation of distributed generation units in increasing numbers in developed regions of the world such as North America and Europe. As a consequence of this and other incentives, US orders for stationary engines grew by 68% in the year to June 2001, with natural gas-fired engine orders up by 95%. This is a trend which is expected to continue in the near future.

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