Business Case Analyse of an Offshore Wind Farm
Vattenfall wanted an external analysis of a business case for a major offshore wind farm. HKS-Consult set out business case scenarios with different wind farm setups. Image: DongEnergy.
HKS-Consult used a three-point estimation of energy production, electricity prices, investments and operating costs. These were entered into an Excel business case model.
The model calculated the project return on investment (IRR), net present value (NPV) and payback period. The method provided major benefits, since Vattenfall could subsequently see the Top 10 uncertainties of the project’s key figures for comparable little effort.
In addition, the project group gains a high degree of ownership of the plan, since the group participates in the estimations.
Order a calculation example of Kriegers Flak offshore wind farm, which HKS-Consult presented at the Wind Power Monthly ‘Offshore Wind Farm Construction Risk Management’ conference in Hamburg.
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Training in the method.
Simple Business Case Calculations
You can relatively easily, make the first estimation of the business case’s key figures. This is done by carrying out a simple three-point estimation of: Investments in buildings and equipment, ongoing costs, operating costs, earnings, etc.
A smaller group estimates the figures, and the numbers are entered into a simple spreadsheet.
You then select the Top 5 elements that contribute with the greatest uncertainty to the business case. Next, you subdivide the Top 5 elements into 2–3 sub-elements and the group carries out an estimation of these.
This process is repeated successively (The Successive Principle) 2–5 times until the group has no more information.
Thus, you acquire an uncertainty assessment of the key figures. Download a simple spreadsheet and get started immediately.
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