## 2 Methodology
### Study Area
* Electricity price in Asalouyeh equals 6 cents per kilowatt-hour (National Petrochemical Company (NPC), 2016). * Fuel methane gas savings of 0.28 cubic meters per a kilowatt-hour produced electricity. * Annual maintenance cost is considered 5% of the investment cost [40]. Figure 6: The schematic view of the certificate issuance process based on a performed project by ORC (Source: authors conception). * The activity level is considered 91% of nominal production capacity of a petrochemical plant per year, which is equivalent to 11 months of operation per year [41]. * Discount rate equals 7.8% [42; 43]. This discount rate is locally and in all different projects the discount rate must be established according to the local circumstances and it may vary from place to place. For example, if your local study is located in the United States and you are using this formula in April 2020, you have to consider the discount rate of 0.25%. In addition to the assumptions mentioned above, the certificates price is another parameter which should be included in the calculations that can be assumed based on two points. The first point concerns a law that was enacted by Iran's supreme council of energy in 2017 (NPC, 2017) in order to define the fundamentals of ESC market formation in Iran. This law is based on the energy subsidiaries and allows an ESCO to sell the saved energy carrier at a low price based on the highest price energy carrier in other sectors of energy systems to the consumers that have violated the standards. The second point is that in Iran's petrochemical industry, the price of methane gas as fuel and feedstock are not determined similarly. Unlike the fuel methane gas, which has a fixed price as previously mentioned, the price of methane gas as feedstock is determined based on a formula, which is described by Equation (5) by simplification of the main formula that has been done by the authors. This issue causes the meaningful difference between the price of methane gas for these two kinds of consumption in such a way, by applying the expected price of oil and Henry Hub Gas in this equation, the expected price of feedstock methane gas will be 11.6 cent/M3, which means the price of feedstock methane gas is at least more than twice of the price of fuel methane. \[\Pr_{\text{G, F,t}}\left(\text{Cent/M3}\right)=0.084\,*\,\Pr_{\text{oil,t}} \left(\text{$\xi/\text{bbl}$}\right)+0.25\,*\,\Pr_{\text{HH,t}}\left(\text{ Cent/M3}\right)+3.33. \tag{5}\]  
Due to these points, the market is limited to the petrochemical industry in this study. Petrochemical plants that have violated the standards in consumption of the fuel methane gas, should buy the certificates that have been issued in the market based on an energy saving project in another petrochemical plant. The price of certificates is assumed equal to the price of feedstock methane gas as in Equation (5). Table 3 presents the calculated NPV based on the considered assumptions. By considering Table 3 and Equations of Section 2.1.2, three factors encompassing the activity level of the consumer, the electricity price and the certificates price are considered to be applied by their probability distributions in the NPV function since these factors are the most important factors which affect the value of benefits and cost in Table 2. The results of the sensitivity analysis in Table 4 shows how the NPV is influenced by these factors and therefore, their probability distributions should be extracted for required calculations of risk assessment. \begin{table}
\begin{tabular}{c c c} \hline \hline
**Item** & **Subdivision** & **Value (Million USD)** \\ \hline \multirow{3}{*}{Benefits} & Produced electricity from waste heat & 0.38 \\ \cline{2-3}  & Sold certificates & 0.24 \\ \hline \multirow{3}{*}{Costs} & Investment cost & 2 \\ \cline{2-3}  & Project’s operational costs, increase of the & \\ \cline{1-1}  & certificates issuance cost, transaction cost, etc. & 0.1 \\ \hline \multicolumn{2}{c}{NPV} & 2 \\ \hline \hline \end{tabular}
\end{table}