Manuscript - Financing Modeling of Renewable Energy Projects

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Specific Characteristics - 2Wind in general• Problems in accurately measuring capacity factor with P50, P75, P90, etc.• Long-term trends in Wind Speed and Global Warming• Performance of P50 studies• Difference between 1-year P75 and 10-year P75• Technology risks of technology evolution• Costs of Grid ConnectionDifficulties in connecting wind turbines to the grid can contribute significantly tothe risks and costs of a project.Off-Shore Wind in specific• The potential for offshore wind is enormous, but the technical challenges are alsogreat. The capital costs are higher than onshore, the risks are greater, theproject sizes are greater and the costs of mistakes are greater.• Methods of installation and operation are already very different from onshorewind generation, with great attention being given to reliability and access.• Off-shore can have high construction risks, revenuer risks (from partialmerchant), scheduling risks, wind risks (from wake effect estimation) and O&Mrisks (need for helicopters and ship hotels).• Cabling from Off-shore may be subject to regulated risks• Costs of Grid Connection for Off-ShoreDepending on the location of the project, cable must be laid over many of hostileand inaccessible environment and, usually, ploughed into the sea bed. As aresult, costs for grid connection kilometers can constitute a very large share ofthe total investment in an offshore project, easily 40%. This contrasts sharplywith onshore where, for most projects, costs for grid connection account foraround 10% of total project cost.8
Financing IssuesWind• Project Financing• Construction Over-run Facilities• Higher Debt Service Coverage Requirement• Shorter Tenor of Debt• Cash Sweep• Implications• Measurement of Value from IRR• Problems with Equity IRR due to Re-financing• Improvements as Technology is ConfirmedSolar• Solar Power Involves Debt Structuring and Sizing more than Risk Analysis• High Capital Cost• Low construction, resource, O&M and pricing risk• EPC Contracts with low premium• Low Standard Deviation of Resource from Year to Year• Feed-in Tariffs Long Term• Risk of Off-taker (Spain)• Objective to optimize debt structure to maximize the rate of return• Analysis is more structuring and less risk analysis• Small Risks such as Variation in Losses Become Big RisksHydro Issues• Hydro power may sell power at merchant prices• Risk analysis depends on electricity prices• Storage Hydro – on peak prices• Run of River – all hour prices• Financing is affected by outlook for prices• Re-financing and cash sweeps• Break-even analysis of prices and marginal cost analysis• Construction Over-run Risk9
Page 1 and 2: MODELINGVALUATION &FINANCING INRENE
Page 3 and 4: IntroductionAlhamdulillah, finally
Page 5 and 6: Characteristic of Renewable Project
Page 7: Specific Characteristics - 1Solar
Page 11 and 12: KPI of Renewable Projects - 11. Ele
Page 13 and 14: KPI of Renewable Projects - 34. Ope
Page 15 and 16: CHAPTER 03Valuation andFinancing te
Page 17 and 18: Financing Terms in Renewable Projec
Page 19 and 20: CHAPTER 04Valuation andFinancing Mo
Page 21 and 22: Modular Development“Thedevelopmen
Page 23 and 24: Steps to Build the ModelStarting wi
Page 25 and 26: 25I. Static Debt Size
Page 27 and 28: MODULE - INPUTFile: 1. Static Debt
Page 29 and 30: MODULE - OPSFile: 1. Static Debt st
Page 31 and 32: RevenueOPS-RevFile: 1. Static Debt
Page 33 and 34: Working CapitalOPS-WCFile: 1. Stati
Page 35 and 36: MODULE - C&FFile: 1. Static Debt st
Page 37 and 38: Financing costC&F-FincostFile: 1. S
Page 39 and 40: Timing ConversionFile: 1. Static De
Page 41 and 42: Project Risk in financiers’ point
Page 43 and 44: File Reference2. Static Debt end.xl
Page 45 and 46: Financial covenantsDebt ratioFile:
Page 47 and 48: DepreciationD&T- BookDepFile: 2. St
Page 49 and 50: Tax Expense vs PaidD&T-TaxExpFile:
Page 51 and 52: MODULE - EQUITYFile: 2. Static Debt
Page 53 and 54: Dividend paymentEquity-DivFile: 2.
Page 55 and 56: Financial StatementFS - IS/BS/CFFil
Page 57 and 58: 57II. Dynamic Debt Size
Page 59 and 60:
Debt DynamicC&F-leverageFile: 3. Dy
Page 61 and 62:
MODULE - MACROFile: 3. Dynamic Debt
Page 63 and 64:
DSRADebt-DSRAFile: 4. Dynamic Debt+
Page 65 and 66:
DSRA MacroMacro-DSRAFile: 4. Dynami
Page 67 and 68:
File Reference5. Dynamic Debt+DSRA+
Page 69 and 70:
Shareholder loanFile: 5. Dynamic De
Page 71 and 72:
File Reference6. Dynamic Debt end.x
Page 73 and 74:
IRRVAL-IRRFile: 6. Dynamic Debt end
Page 75 and 76:
MODULE - AFSContentFINANCIAL STATEM
Page 77 and 78:
MODULE - DASHBOARDContentDashboard
Page 79 and 80:
File Reference7. Deterministic mode
Page 81 and 82:
Monte Carlo Simulation (Probabilist
Page 83 and 84:
SIPmath InstallationInstruction1. D
Page 85 and 86:
Probabilistic ModelFile: 8. Probabi
Page 87 and 88:
Steps to build probabilistic Model
Page 89 and 90:
Page 91 and 92:
Page 93 and 94:
Page 95 and 96:
Price Optimizationa. Deterministic
Page 97 and 98:
Price Optimizationb. Probabilistic
Page 99 and 100:
WRAP - UP1. Renewable Project Chara
Page 101:
Modeling valuation and financing in
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Manuscript - Financing Modeling of Renewable Energy Projects

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