Cost decreases are due to the deferral of the conventional generation capacity that would have been required that year. The amount of capacity deferred in 1994 would be x g where g is the power pool growth rate. If all the deferred capacity is assumed to be in the form of nuclear generation capacity, the decrease in 1994 would be where f is the fixed cost factor assumed to be .15. Forty-six percent (46%) of the fixed costs are assumed to continue to rise with inflation and the rest is fixed once the plant is built. If the SPS had not been built, other conventional generation capacity ^max * 8 ' + 8) 1 would have been built the following year. The savings associated with this capacity must be added to the savings due to conventional capacity deferrals from the previous year. This continued until the total amount of deferred conventional capacity equals 5 GWe. At that point, the cost of the extra reserve capacity must be added. Thereafter, the changes in the utilities fixed and operating costs are governmend by the general rate of inflation. The per unit fixed and operating cost of the energy sold by the power pool is defined as follows:
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