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                        C total   C CHP  retr .   C abs .ch .   C pipes   C spec .el .   C civ .   C instal .   C subst .        (7)
               where:
               - CCHP retr. indicates the cost for the CHP retrofit of the diesel engines. This retrofit essentially
               requires installation of shell and tube heat exchangers for high temperature recovery from hot
               gases (unit cost in the order of 100-120 €/kW) and plate heat exchangers for low temperature
               recovery from the jacket cooling water circuit (unit cost in the order of 110-130 kW);
               - Cabs.ch. indicates the cost for the absorption chillers. The inclusion of this cost component in the
               financial  evaluation,  which  is  of  course  pertinent  only  in  the  two  cases  (Lampedusa  and
               Pantelleria) where space cooling requests are also covered, suggests that the existence of some
               Energy Performance Contract (like the so-called “shared savings”) between the company and the
               supplied customers is assumed;
               - Cpipes is the cost of the required length of the main and branch pipes. Several catalogues from
               different  manufactures  were  examined  [32,33],  to  develop  useful  correlations  between  the
               diameter of the pipe and the cost per unit length (Eq. (8) and (9)):

                          pre
                                                    2
                                               
                                                              
                        c pipes ins  . steele   0. 002 ND  0. 123 ND  16. 73       [€/m]     (8)
                          polyethile
                                                  2
                                             
                                                              
                        c pipes  ne   0. 0011 ND    0. 6128 ND    16. 73      [€/m]         (9)

               Both the above correlations provide a reasonable estimation of the unit cost of pipes over the
               range of diameters ND (25 mm, 150 mm).
               -  Cspec.el.  represents  the  cost  for  special  elements  such  as  junction  boxes,  TEE  junctions  and
               expansion joints;
               - Cciv. represents the cost for civil works;
               - Cinstal. represents the installation cost of the DH network;
               - Csubst. represents the total cost of substations (inclusive of heat exchangers, energy metering and
               control equipment). This cost is excluded from the total cost for the scenario (adopted only in
               Pantelleria) that assumes connection costs covered by the private customers.
               All these costs were estimated on the basis of average cost figures. Details on the value of each
               specific cost fraction are not provided for sake of brevity; in Table 5 the capital investments
               calculated  for  the  whole  project  (including  CHP  retrofit  and  installation  of  DH  network  and
               related equipment) are presented.

                 Table 5. Capital investment for the whole “CHP retrofit + DH network” project in each island


                                                          Total investment for the
                                              Island
                                                            whole project [M€]
                                         Lampedusa                6.628
                                         Favignana                4.422
                                         Pantelleria              3.061
                                         Ustica                   1.235
                                         Giglio                   0.961
                                         Linosa                   0.602


               As concerns the net annual revenues, they were calculated as difference between the incomes
               from heat selling activity and the operating costs (which are usually available broken down into a
               number of different components). Basing on data available in literature, this last term is at-a-flat-

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