Discounted Cash Flow Calculator: Evaluate Renewable Energy Projects
This DCF tool converts your renewable project’s future earnings into today’s dollars using tariff, output, WACC and years. A 5.8 % global average WACC for renewables sets a useful benchmark (IEA, 2022).
Discounted Cash Flow Calculator
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How to use the tool
1 – Real Feed-in Tariff (USD/kWh): Type your contract price, e.g., $0.11 or $0.18.
2 – Annual Production (kWh): Enter yearly output such as 5 000 000 or 6 800 000.
3 – WACC (%): Insert your weighted average cost of capital, e.g., 8 % or 5.5 %.
4 – Project Lifetime (years): Provide expected operating years like 18 or 27.
5 – Calculate: Press “Calculate” to view the discounted cash flow in dollars.
Utility-scale solar O&M averages $13/kW-yr (NREL Cost Report 2022).
Global renewable WACC fell to 5.8 % in 2021 (IEA World Energy Outlook 2022).
IEC 61215 suggests 25–30 year service life for crystalline-silicon PV modules (IEC 61215:2021).
FAQ
What does the discounted cash flow reveal?
DCF estimates today’s value of all future project cash inflows after risk adjustment, letting you compare investments on equal footing (Damodaran, 2022).
How do you compute annual cash flow?
You multiply the real feed-in tariff by yearly energy production; no operating costs are deducted in this tool.
Why use WACC instead of a fixed discount rate?
WACC reflects both debt and equity costs, aligning discounting with the project’s actual financing mix (Brealey & Myers, Principles of Corporate Finance 2020).
How sensitive is DCF to tariff changes?
A 10 % tariff increase raises CF by 10 %, which proportionally lifts DCF when other inputs stay constant.
What lifetime should you enter?
Use the technical life stated in equipment warranties—25 years for many PV modules per IEC 61215:2021.
Can you factor in O&M costs?
Subtract annual O&M from CF before entering if you want net cash flow; typical solar O&M is $13/kW-yr (NREL 2022).
Does the calculator consider inflation?
No. Enter real (inflation-adjusted) tariffs and WACC so inflation effects cancel out.
What is a “good” DCF value?
A DCF exceeding the initial capital cost signals positive net value; investors target positive NPV at their hurdle rate (IEA Project Handbook 2021).
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