IPP Renewable Energy Financial Models

Renewable Energy Financial Models- wind

We have been involved in a number of Renewable Energy Financial Models for IPP’s (Independent Power Producers). Although Solar modelling is the most popular, we also have experience with wind and hydro (and even some of the fossil fuels such as coal and LPG).

The assignments have included:

  • feasibility studies of implementing renewable energy including cost/ benefit analysis of replacing fossil fuels,
  • auditing of Renewable Energy Financial Models,
  • converting annual models to monthly models, and
  • building tracking spreadsheets to assess performance versus original financial model or budget.

The models have been built both from the end users point of view as well as from the developers depending on the financing arrangements/ target audience/ renewable energy type.

Features of our MS Excel Renewable Energy models

All our financial models are built in MS Excel and based on spreadsheet best practice methodologies incorporating three way modelling (at least the Income Statement, Cash Flow Statement and Balance Sheet) based on the clients specific requirements.

Models are always built on a monthly basis (at a minimum) with reporting on quarterly, semi annual or annual basis. Where relevant, the power generation has also been calculated on a hourly and daily basis.

Operational Capabilities included in renewable energy models

We customise the models to suit the clients needs, but for renewable energy modelling the following is generally included (at a minimum):

  • Savings generated from the current energy source
  • Yield on a daily, monthly and yearly basis allowing for multiple levels of confidence (P50, P90, P99),
  • Degradation factors built into the model,
  • Impact of seasonality on the operations,
  • Construction times allowing for delay sensitivities including building in penalty options where relevant,
  • Multi currency and currency impacts on capex, opex and revenue with hedging options,
  • Allowance for the concession periods with variability to determine optimum periods.

Financing Arrangements for Renewable Energy Models

Detailed, flexible financing options that include robust equity versus debt and various debt repayment type options. Includes calculation of the cash waterfall allowing for financial structuring negotiations.

Renewable Energy Financial Models- Solar

Debt options typically include:

  • Amortising or Equal Capital installments
  • Sculpting based on defined DSCR or other debt sculpting requirements
  • Sweep options to assess viability of the project to handle debt at all.
Renewable Energy Financial Models

Renewable Energy Sensitivity Modelling

As a result of the best practice financial modelling method used, detailed sensitivities are possible on any of the key inputs.

Where relevant the possible savings from using renewable energy instead of fossil fuel energy is shown and quantified.

Renewable Energy Financial Models- hydro sensitivity

Renewable Energy Modelling Experts

To find out more about the IPP Renewable Energy modelling we can assist you with, send an email to info@AuditExcel.co.za.