Spemann PG-ROI Examples

 

 

 

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PG-ROI EXAMPLE 1
New Power Plant
Base Case Assumptions
 
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This example is from a market research for a power plant provider.
He wants to estimate the market potential for new plants in a developing market with uncertain base load prices for electricity.
One of his questions is regarding the investment decision from his customers point of view, so he wants to know the market conditions under which the investors would invest.
He formulates his question: which would be the minimum price to ensure a Internal Rate of Return of 25%?
Additionally he wants to have this information in a sensitivity analysis for different operating hours per year (5000-8000).


This is a typical question to be solved by Spemann PG-ROI, as the following steps will show.