Environmental Analysis Charlie Jo Environmental Essay

This equation is more equipped to take into account changes in costs and cash flows on an annual basis, and with energy prices likely to increase this will yield a better view of the situation. Assuming a 10% annual increase in the price per kWh yields the following costs of 15,000 kWh of purchased electricity:

Year 0: $3,000

Year 1: $3,300

Year 2: $3,630

Year 3: $3,993

Year 4: $4,392

At a 75% savings, cash inflow would be:

Year 0: $2,250

Year 1: $2,475

Year 2: $2,723

Year 3: $2,995

Year 4: $3,294

The additional savings in preventing costs of carbon emission removal can be estimated at two cents per kg, for an additional annual savings of $3,000. According to the Net Present Value equation, each of these projected inflows must be discounted by the discount rate (given as 5%), resulting in the following determination of value:

NPV = (5250)+(5475/1.05)+(5723/1.05^2)+(5995/1.05^3)+(6294/1.05^4) = $26,012, meaning the project is definitely worth the initial cost of $22,000 even from a purely financial perspective.

Environmental Performance Indicators

Data

Heavy Lin.

Efficiency

Swimwear

Efficiency

Raw mat.

0.821917808

0.826446281

Electricity

0.0

0.0

Chem. & dye

40

15

40

10

Water input

70000

0.008571429

20000

0.02

Water waste

60000

0.01

10000

0.04

Solid waste

2

2

Carbon equiv.

0.0

0.0

Finished prod.…