Grid Integration of Wind Power: Best Practices for Emerging Wind ...
Project Finance, Overview - Islanded Grid Resource … Finance, Overview Islanded Grid Wind Power...
Transcript of Project Finance, Overview - Islanded Grid Resource … Finance, Overview Islanded Grid Wind Power...
Project Finance, Overview
Islanded Grid Wind Power Conference March 6th, 2015
Gregory Price PNECorp.
C: 360-442-1937 O: 360-423-2245 F: 360-423-2272
[email protected] www.pnecorp.com
Knowledge Lowers Risk!
Image Courtesy of NREL
Risk = Cost Perceived and Real: Both will increase expense The less you know, The more you’ll owe!
Considerations • Wind resource and bankability (V3)
• Tax credits (PTC, ITC, EDTC) • Federal, state, and utility incentives (taxed and untaxed) • Depreciation (NPO vs. FPO) • Loan guarantees • REC’s and Green Tags, reduced emissions • Utility interconnections (net metering) • Value of electricity vs. value of heat and other secondary loads • Redundancy, marketing, energy security, predictability
Financing Models and
Considerations • Power Purchase Agreements (PPAs) • Third party ownership • Leasing: Capital vs. Operating • Debt vs. equity financing • Flip models • Community and cooperative ownership • Legalese • O&M and lifetime cost of ownership of turbines and gen-sets • Warranties • Partnerships and accountability
Financial Metrics
• Simple Payback • Return on Investment (ROI) • Internal Rate of Return (IRR) • Levelized or Lifetime Cost of Energy • Net Present Value • Tons of CO2
• Capacity Factor • Cost/kW • Hurdle Rate • Discount Rate, opportunity and avoided costs • WACC (Weighted Average Cost of Capital)
Islanded Grid Wind Power Conference
Thanks for coming, looking forward to your questions!
Gregory Price PNECorp.
C: 360-442-1937 O: 360-423-2245 F: 360-423-2272
[email protected] www.pnecorp.com