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Finance » Renewable Energy Projects

Financing your renewable energy project: What's a good project?

Key to getting funding is to have a 'good' project where the underlying parameters (before financing) present a solid case.

We have developed an interactive, holistic tool to compare different opportunities in solar pv. It scores the projects along 5 dimensions (irradiation, tariff, technical performance, cost as well as riskiness) and depicts the resulting area in a diagram. A larger area implies potentially better opportunity.

For an in-depth analysis or feasisbility study of your project, please contact us.

Site 1
Site 2
Location:
Irradiation [kWh/m²]:
performance ratio [%]:
Tariff [$c/kWh]:
Credit risk:
Capex [$/kWp]:
Political & regulatory risk (1=low, 10=high):
Total score:
45
5
5 dimensions of a solar pv project opportunity
The 5 dimensions in our holistic estimator of an opportunity for a solar photovoltaics power plant are:
  1. Irradiation: This is the annual global irradiation that falls onto a horizontal surface per annum. Values range from 800-2600 kWh/m².
  2. Revenue: on the revenue side the crucial component is the tariff. The score however is adjusted depending on the level of credit risk. Higher credit risk results in a lower score in this category..
  3. Performance: The performance ratio is an indicator of the quality of the system, i.e. how much of the available irradiation (in the horizontal plane) is actually converted. This parameter ranges from 60-120%.
  4. Capex: Capital expenditure is the single most important cost item in a solar photovoltaic generator. In this interactive tool, we accept values from $450 - 1200 per kWp. This figure should include all costs for development, equipment, installation and interconnection.
  5. Risks: The success of a project and its prospects for investment very much depend on country-specific aspects such as political risk and ease of doing business. Score 1 - 10 with 1 being "low risk" and 10 "very high risk".

The above graph shows the scores along those axis. The larger the resulting area, the better the opportunity might be.

On earth, values hover from 800 - 2600. See irradiation maps for more details.
Performance Factor: Values depend on choice of system as well as the position of the module. For a crude approximation, use:
  • Horizontal: 80%
  • Optimum tilt angle: 90%
  • 1-axis tracker: 100%
  • 2-axis tracker: 110%
See separate article on calculation of performance factor
Comparison: Hamburg and Bulawayo
We have used the tool to compare two ficticious projects - one in Hamburg (Germany), the other in Bulawayo (Zimbabwe).

With more sun and using the tracking device, the Bulawayo project scores higher on performance and irradiation.

On the other hand, Germany provides a low risk background with a long history of developing a solar infrastructure, which also results in lower capital expenditure.

 

Try it out for yourself
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