Parameter Name | Details | Calculation |
Energy Production | The user can set a factor that will be applied to monthly energy production. | Energy Production (kWh) * factor |
Degradation | The user can set an annual percentage degradation of power output, it will be applied on a monthly basis. Can be calculated as %/year or %/year gradual decline.
Gradual decline starts one month after production is at full capacity, two months after cut off date. Gradual decline spreads the decline each month.
Yearly decline spots down each year, starting from the cut off date. The step down will be on month 13. | Gradual Decline: Energy Production (kWh) * ((1-factor%)^(1 /frequency)) The frequency will be set to 12 for monthly, or 4 for quarterly, etc.
Yearly Decline: Energy Production (kWh)*(1-factor%) |
Monthly Haircut | The user can apply a monthly haircut to both:
| Monthly Haircut * Revenue fields
Energy Production (kWh) * factor |
Monthly Default | The user can set a percentage of power generation that defaults on scheduled payments. This percentage will exit the pool of performing assets. |
Note: Prepayment is applied before default since it is not possible to default on prepaid assets. |
>Severity | The user can set the percentage of defaulting assets that will lapse into permanent default, the rest will recover as they will be temporarily default.
If the user defines 30% severity, 30% will permanently default, while 70% of the pool will be recovered as future cash upon liquidation. |
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>Lag | The lag will determine at which period:
Calculated in Months |
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Monthly Renegotiation Rate | The user can set the portion of temporarily defaulted assets that re-enter the pool of performing assets under a renegotiated PPA. The remainder of the temporarily defaulted assets that re-enter the pool are subject to the terms of the original PPA. |
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>Renegotiated PPA: Merchant Discount
| This field determines the rate ($/kWh) of the renegotiated PPAs as a discount to the rate specified under Portfolio >> Market Rates >> Merchant Power Curves. | |
>Renegotiated PPA: Escalator
| This field determines the annual percentage increase in the rate for renegotiated PPAs. | |
Residual Term | The user can set the number of periods that a project generates residual revenue after the original PPA term expires. |
Residual PPA Rate ($/kWh) = Merchant Power Curve ($/kWh) * (1 - Residual PPA: Merchant Discount %)
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| >Residual PPA: Merchant Discount
| This field determines the rate at which a project generates residual revenue as a discount to the rate specified in Portfolio >> Market Rates >> Merchant Power Curves. | |
| >Residual PPA: Escalator | This field determines the annual percentage increase in the rate for residual PPAs. | |
| Monthly Prepayment Rate | This field determines the percentage of power generation that prepays the remainder of its PPA contract. Once a portion of power generation prepays, it is removed from the pool of power-generating assets. |
Note: Prepayment is applied before default. |
| >Prepayment Amount | This field represents the remaining value of the PPA contract. It is multiplied by the Monthly Prepayment Rate to result in the Prepaid PPA Revenue. | |
| Cashflow Adjustment | This is applied to the net revenue from a project. The revenue haircut can be applied as a $ value deduction (absolute value) or as a factor of net revenue (factor). The cash flow adjustment is calculated similarly to the haircut, but only on the NOI if unit chosen is factor. Units available:
| Factor unit calculation: Cash Flow Adjustment * NOI |