Financial Modelling
Maximizing Project´s Return on Investment,
by Preventing Projects Delay, Cost Overrun and Revenue Losses
Project´s Financial Model
To better understand the financial viability of an Offshore Wind Project, we develop a cash flow model to calculate two results, amongst others:
- Levelized cost of energy (LCOE), and Internal Rate of Return (IRR)
- Breakeven price (BP), that makes the Project financially viable.
We input CAPEX either from Suppliers binding offers or from our costsbooks based on our participation in more than 50 projects in Europe, Asia and Americas. We assess OPEX from a computer simulation of all O&M activities required during the lifetime of an offshore wind project.
The computer model can be run for a range of inputs according to local regulation, electricity market, etc to assess how and what changes in policy incentives, project inputs, and financial structure affect the breakeven price of offshore wind power.
1.
- Resource (Wind, Wave, and Current Data Collection): Collect wind, wave, and current data through hindcast, metocean buoys, met masts, or LiDAR. Analyze seasonal and long-term patterns in wave height, period, and current speeds.
- Park Layout Development:
Use wind flow models to optimize turbine placement, maximizing energy yield while minimizing wake effects and turbine loading.
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Site Suitability Assessment: Design equivalent turbulence intensity values, for estimating fatigue loading and fatigue lives of turbine components under the conditions specific to their particular location in a wind farm.
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Power Production Forecasting: Use wind resource assessments to project annual energy production (AEP) and adjust for turbine availability and expected efficiency losses.
- Others.
2.
CAPEX Estimation
- Turbine Procurement and Installation Costs: Estimate the cost of purchasing and installing turbines, including transportation and logistics.
- Foundation and Substructure Costs: Assess costs associated with foundation design, manufacturing, and installation, including materials, labor, and specialized installation vessels.
- Electrical Infrastructure and Cabling: Estimate costs for infield and export cables, substations, transformers, and grid connection.
- Development and Permitting Costs: Include costs associated with environmental impact assessments, permitting, engineering design, and regulatory approvals.
- Construction and Contingency Budgeting: Add a contingency budget for unexpected costs during the construction phase, accounting for delays or changes in material costs.
- Others.
3.
- Routine Maintenance Costs: Estimate maintenance costs for turbines, foundations, and electrical infrastructure, based on expected maintenance schedules.
- Insurance Costs: Include insurance premiums for assets and liability coverage during construction and operation.
- Operational Staff and Management Costs: Budget for the costs of on-site staff, remote monitoring, and operational management throughout the project lifecycle.
- Vessel and Equipment Costs: Include costs of specialized vessels and equipment for routine and unscheduled maintenance.
- Degradation and Replacement Costs: Account for degradation and the potential need to replace components over the project's lifespan.
- Others.
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