Financial analysis

Financial analysis of your project

The financial analysis is based on standard methodology calculations and considers factors such as price of electricity, system installation costs, annual operational costs, baseline accounting information, and PV system configuration. System automatically calculates the costs using the default values. Several inputs can be changed to get a more accurate estimate if required.

The summary shows the overall financial performance of your project. Here’s what these values mean for you:

• Internal Rate of Return (IRR) for the Project: This indicates the overall profitability of your project, showing how well it generates returns compared to its costs.

• Internal Rate of Return (IRR) for Equity: This value shows how well your equity investment in the project is performing, considering both profits and the cost of equity.

• Return on Investment (ROI): This metric tells you whether your investment is yielding a profit or loss, with negative values indicating a loss.

• Levelized Cost of Energy (LCOE): This measures the average cost of producing one kilowatt-hour of electricity over the project's lifetime, helping you understand its cost-effectiveness compared to other energy sources.

You can view detailed financial and operational metrics for your project over its lifetime in the the Cash Flow table. Here’s what you can see:

• PVOUT_total (kWh): This column shows the total amount of electricity produced by your solar panels each year, with a cumulative total at the end.

• PVOUT_specific (kWh/kWp): This metric indicates the efficiency of your solar panels, showing how much electricity they produce per kilowatt of installed capacity each year.

• Maintenance Reserve Account (USD/annually): This is the annual amount set aside for maintenance costs, which are typically allocated for the first 12 years.

• OPEX (Operating Expenses) (USD/annually): These are the annual operating costs, which include maintenance, repairs, and other expenses necessary to keep the project running.

• Revenue (USD/annually): This shows the annual income generated from selling the electricity produced by your project.

• EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) (USD/annually): This metric indicates the profitability of your project before accounting for non-operational expenses like interest and taxes.

• EBITDA_specific (USD/annually): This is the EBITDA per unit of installed capacity, providing a measure of profitability relative to the project's size.

These metrics help you understand the financial health and operational efficiency of your solar project over its initial 25-year period.

Customizing the analysis inputs

You can edit default values used for calculation in the Inputs section. You can amend the following inputs:

If required, you can save your new configuration and use it later for comparison with different setup. Links for saving, loading, and resetting to defaults are located at the bottom of the Inputs table.