Capital Allocation Financial Model based on Equity Internal Rate of Return (EIRR) for Renewable Energy Projects

Description
This financial model tool specifically for renewable assets (solar, onshore / offshore wind) projects allows users to project and forecast the project internal rate of return (PIRR) and equity internal rate of return (EIRR), ascertain the financial viability of the projects from return and debt servicing perspective and determine the amount of capital funding required. Although the model is built for the renewable energy sector, users customise it to fit other company, sector and industry. This tool will help the user to determine the equity funding requirement as part of the business plan or annual operating plan and allocate the capital to the most profitable projects based on EIRR against the internal hurdle rate.


The financial model consists of the following:
1) Instruction to users on how to create unlimited projects for return evaluation
2) Cover page
3) Input tab as well as 2 project templates (which includes checks for data integrity and debt repayment)
a) Input – contains all the key assumptions for the financial model
b) Project 1 (operational asset) – contains the P&L, cash flows and return analysis as well as workings for taxation, debt servicing and working capital
c) Project 2 (asset under development) – contains the P&L, cash flows and return analysis as well as workings for taxation, debt servicing, working capital, and cost under construction (including interest)
4) Output tab
a) Capital allocation based on net differential return (EIRR against internal hurdle rate (COE))b) Portfolio cashflows analysis to arrive at overall portfolio project IRR and EIRR


The FM does not include a valuation model, financial ratio analyses nor graphical illustrations of the output.