TABLE 37 ANNUAL EXPENSES ASSOCIATED WITH $100 OF PLANT EQUIPMENT Expenses Deductible from Income $/Year State and Local Taxes 2.45 Property Insurance 0.40 Interim Replacements 0.35 Interest (8.06% on $50) 4.03 Subtotal 7.23 After-Tax Earnings to Yield an 11.4 Price/Earnings Ratio on Common Stock Sold for $50.00 4.39 Federal Income Tax (at 50% of Pretax Earnings) 4.39 Total 16.01 7) Computation Example The calculation of the mills per kilowatt-hour is shown below. Using a 14% charge and 7000 hours per year — both figures that have been reasonably close to reality - one arrives at the easily applied rule-of-thumb that each $100 per kilowatt of capital costs results in 2 mills per kilowatt- hour. b. Consumption of Resources Man's total need for energy is expanding at such a rate that serious economic, social, and environmental issues are being created. It has been forecast that between now and 2001 the United States will consume more energy than it has in its entire history, and that by 2001 the annual U.S. demand for energy in all forms will double and the annual world-wide demand will probably triple. These projected increases will tax man's ability to discover, extract, and refine fuels in the huge volumes necessary to ship them safely and to dispose of waste products with minimum harm to himself and his environment. Therefore it is imperative that choices of technology be made, considering the total energy balance. Thus for any energy production method the period required to
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