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Grid connected photovoltaic

Business model and economic analysis of the investment

 

High yield per year

10 % guaranteed

Low investment

3.300 €

Guarantees

Efficiency insurance

Duration

25 years

Income per year

330 € for each 3.300 € invested + payback of capital

Aditional income at 25th year

2.343 €

 

Investmen guaranteed by Spanish Law:

 

Royal Decree 436/2008, 661/2007, 1578/2008, 6/2009 y 1565/2010 y Royal Decree 14/2010

 

The Limited Company, which is de vehicle of investment, owns permits, licenses and authorizations legally required and the right to use the covers for the location of the photovoltaic power of 2MW.

 

The capital of the company amounts to the amount of 200,000 €, divided into 2,000 shares of par value € 100 each. All shares in the company are of the same series and class giving their holders the same rights and obligations.

 

Investment appraisal

The assessment of the total investment facing society is given by the total costs of the installation

  • Payment to the contractor for the turnkey construction of the plant
  • Expenditure on promotion and rental of the covers for 25 years (satisfied in advance under contract for rights of use)

The total value of this investment is:

  • TOTAL INVESTMENT = 6,600,000 Euros

Key features of the equity loans:

  • Duration: 25 years
  • Fixed interest rate: 10%
  • Period of accrual of interest: quarterly.
  • Amortization 100 quarterly installments of principal and interest.
  • Fee quarterly repayment:
    • 174,796 Euros / quarter
    • 699,184 Euros / year

Operating income

The operating incomes are given by the operation of the plant, i.e. the sale of energy generated at a rate of 0.2789 Euros / kWh (call first quarter 2011) and the sale of surplus in the market to 0.056 Euros / kWh.

  • Annual production: 2,730,000 kWh / year, of which 2,724,000 kWh will be sold at regulated prices and the rest at market price (as RD 14/2010)
  • Annual Revenue: 760,000 Euros / year

Operating expenses

Running costs of the plant, since the costs associated with facility rentals have been paid before the coming into operation of the installation.

 

Total operating expenses amount to 52,500 € per year, encompassing the following:

  • Operation and Maintenance Contract
  • Insurance
  • Administrative and management of the company
  • Subsistence
  • Representation on the market

The OPERATING MARGIN (INCOME - EXPENSES) will address the repayment of loan amounting to 699,184 Euros / year.

 

This refund will be received by the shareholders in four quarterly instalments throughout the year, in proportion to their participation.

 

The starting parameters for the economic study of the project are:

  • Degradation production modules: 0.8% per year
  • IPC (Inflation): 3%
  • Capitalization Rate: 5%
  • Increase in Sales Rate: CPI - 0.5
  • Amortization: 5%
  • VAT: There will be a loan with a financial institution until his return in July 2012.
  • Tax rate: 25%

The following tables show the results for the COMPANY and the results for the INVESTOR.

 

This aims to demonstrate the viability of the investment itself, guaranteeing the repayment of shareholder loan to the shareholders, and showing the minimum return that they get for their investment.

 

ECONOMIC ANALISYS – INVESTOR

2 MWn

1 kWn

Initial Investment

6.600.000 €

3.300 €

Capital of the company

200.000 €

100 €

Participatory loan

6.400.000 €

3.200 €

Anual Revenue (Loan repayment)

699.184 €

349,59 €

Capital return at 25th year

200.000 €

100 €

Cash distribution accumulated at 25 th year (7)

4.686.335 €

2.343 €

 

 

 

TIR of the investment (25 years)

10,3 %

10,3 %

NPV of the investment (25 years)

4.638.150 €

2.319 €

PAYBACK

9,44 years

9,44 years

(3) Repayment of the loan in four quarterly installments. The right of repayment of loan will be paid from the commissioning of the installation (August 2012) and the first payment on account will depend on the first deposit made by the National Energy Commission (Spanish Government) in respect of sale of Energy.

(4) Values ​​calculated without leverage or tax purposes.

(5) See footnote 4.

(6) See footnote 4.

(7) Return accumulated after-tax cash. (At capitalization rate of 5%.)

 

The insurance company guarantees

  • All Risk Coverage.
  • Coverage of profits in case of accident while carrying out the repair work.

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