Professional Documents
Culture Documents
Scenario Definitions
Entry Cells
Scenario A: Non-Taxable Rebate - Assumes that the state rebate is non-taxable, but is subtracted from the cost basis for purposes of determining tax credits and accelerated depreciation.
Scenario B: Taxable Rebate - Assumes that the state rebate is taxable, but is not subtracted from the cost basis for purposes of determining tax credits and accelerated depreciation.
Both Scenarios assume that the project owner can use both federal and state tax benefits
Taxable
Non-Taxable
Taxable
$
$
$
$
$
$
$
13.0%
0.50%
25
20
0.16
3.0%
0.285
10
0.0%
17.59
3,518
3.0%
0.30
10
%
$/kWh
Years (must be equal to or less than project life)
%
$/kWh
Years (must be equal to or less than project life)
$/kW/Year
$/Year
%
$/Watt (DC STC)
Year (must be equal to or less than project life)
Tax Assumptions
Federal Tax Rate
State Tax Rate
Effective Tax Rate
Federal Tax Credit
State Tax Deduction
5 Year Accelerated Depreciation Schedule (MACRS)
Depreciation
Asset Basis
Gross Cost
Rebate
Less 50% of Federal Tax Credit
Asset Basis
Financing Assumptions
% Financed w/ Cash
% Financed w/ Loan
Loan Interest Rate
Loan Period
Net Cost
Customer Discount Rate
Loan
35%
10%
42%
30%
100%
20.00%
20.00%
32.00%
32.00%
19.20%
19.20%
11.52%
11.52%
11.52%
11.52%
5.76%
5.76%
0.00%
0.00%
$
$
$
1,100,000
(165,000)
935,000
$
$
100%
Cash
0%
9.00%
Loan
20 Years (must be equal to or less than project life)
1,100,000
8.00%
-
52,425
Year 7
9.4%
10%
Disclaimer: This Unofficial Cash Flow Model is intended to provide non-residential entities that are considering the purchase and installation of solar energy equipment with a general understanding of possible financial implications
of such purchase and installation. Those entities interested in learning more about the financial implications of the purchase and installation of solar energy equipment are urged to consult their own tax and financial experts. The
information contained in the Unofficial Cash Flow Model may not be relied on by anyone for any purposes. Furthermore, the information contained in this model does not necessarily reflect the views of the Department of Energy
Resources or the Commonwealth of Massachusetts, and reference to any specific method does not constitute an implied or expressed recommendation or endorsement of it. Neither the Department of Energy Resources nor the
Commonwealth of Massachusetts make any warranties or representations, expressed or implied, as to the usefulness, completeness, or accuracy of any processes, methods or other information contained, described, disclosed, or
referred to in this model. Finally, neither the Department of Energy Resources nor the Commonwealth of Massachusetts makes any representation that the use of any product, apparatus, process, method, or other information will
not infringe privately owned property rights and assumes no liability of any kind or nature for any loss, injury, or damage directly or indirectly resulting from, or occurring in connection with, the use of information contained,
described, disclosed, or referred to in this Unofficial Cash Flow Model.
242724786.xls
Project Output
Annual Generation (kWh)
Year
1
227,760
Year
2
226,621
Year
3
225,488
Year
4
224,361
Year
5
223,239
Year
6
222,123
Year
7
221,012
Year
8
219,907
Year
9
218,807
Year
10
217,713
Year
11
216,625
Year
12
215,542
Year
13
214,464
Year
14
213,392
Year
15
212,325
FINANCIAL SCHEDULES
INCOME STATEMENT
Electricity Revenue (Avoided Cost)
CEC Rebate
SREC Auction Revenue
SREC Contract Revenue
$
$
Replace Inverter?
Operations & Maintenance Costs
Inverter Replacement Cost
$
$
$
No
$
$
EBIT
EBT
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
36,442 $
37,347 $
38,275 $
39,226 $
40,201 $
41,200 $
42,224 $
43,273 $
44,349 $
45,451 $
46,580 $
47,738 $
48,924 $
50,140 $
51,386
$
$
46,580 $
$
$
47,738 $
$
$
48,924 $
$
$
50,140 $
51,386
64,912
101,353
No
(3,518)
(3,518)
97,835
(187,000)
(89,165)
(89,165)
34,632
(9,784)
(64,316)
$
$
$
$
$
$
$
$
$
$
$
(64,316) $
187,000 $
122,684 $
(1,100,000)
77,000
330,000
(693,000) $
$
$
$
$
$
64,587
101,934
No
(3,624)
(3,624)
98,311
(299,200)
(200,889)
(200,889)
73,752
(9,831)
(136,968)
$
$
$
$
$
$
$
$
$
$
$
$
$
$
(136,968) $
299,200 $
162,232 $
64,264
102,539
No
(3,732)
(3,732)
98,807
(179,520)
(80,713)
(80,713)
31,708
(9,881)
(58,886)
$
$
$
$
$
$
$
$
$
$
$
$
$
$
(58,886) $
179,520 $
120,634 $
63,943
103,169
No
(3,844)
(3,844)
99,325
(107,712)
(8,387)
(8,387)
6,412
(9,932)
(11,908)
$
$
$
$
$
$
$
$
$
$
$
$
$
$
(11,908) $
107,712 $
95,804 $
63,623
103,824
No
(3,960)
(3,960)
99,865
(107,712)
(7,847)
(7,847)
6,242
(9,986)
(11,592)
$
$
$
$
$
$
$
$
$
$
$
$
$
$
(11,592) $
107,712 $
96,120 $
63,305
104,505
No
(4,078)
(4,078)
100,427
(53,856)
46,571
46,571
(12,785)
(10,043)
23,743
$
$
$
$
$
$
$
$
$
$
$
$
$
$
62,988
105,212
No
(4,201)
(4,201)
101,012
101,012
101,012
(31,819)
(10,101)
59,092
$
$
$
$
$
$
$
$
$
$
$
$
$
$
62,673
105,947
No
(4,327)
(4,327)
101,620
101,620
101,620
(32,010)
(10,162)
59,448
$
$
$
$
$
$
$
$
$
$
$
$
$
$
62,360
106,709
No
(4,456)
(4,456)
102,252
102,252
102,252
(32,209)
(10,225)
59,818
$
$
$
$
$
$
$
$
$
$
$
$
$
$
62,048
107,499
Yes
(4,590)
(60,000)
(64,590)
42,909
42,909
42,909
(13,516)
(4,291)
25,102
$
$
$
No
$
$
$
$
$
$
$
$
$
$
$
No
(4,728)
(4,728)
41,852
41,852
41,852
(13,183)
(4,185)
24,484
$
$
$
$
$
$
$
$
$
$
$
No
(4,870)
(4,870)
42,868
42,868
42,868
(13,503)
(4,287)
25,078
$
$
$
$
$
$
$
$
$
$
$
No
(5,016)
(5,016)
43,908
43,908
43,908
(13,831)
(4,391)
25,686
$
$
$
$
$
$
$
$
$
$
$
No
(5,166)
(5,166)
44,973
44,973
44,973
(14,167)
(4,497)
26,309
$
$
$
$
$
$
$
$
$
$
$
(5,321)
(5,321)
46,064
46,064
46,064
(14,510)
(4,606)
26,948
26,948
26,948
23,743 $
53,856 $
77,599 $
59,092 $
$
59,092 $
59,448 $
$
59,448 $
59,818 $
$
59,818 $
25,102 $
$
25,102 $
24,484 $
$
24,484 $
25,078 $
$
25,078 $
25,686 $
$
25,686 $
26,309 $
$
26,309 $
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
(693,000) $
(693,000) $
122,684 $
(570,316) $
162,232 $
(408,085) $
120,634 $
(287,451) $
95,804 $
(191,646) $
96,120 $
(95,526) $
77,599 $
(17,927) $
59,092 $
41,165 $
59,448 $
100,613 $
59,818 $
160,430 $
25,102 $
185,532 $
24,484 $
210,015 $
25,078 $
235,093 $
25,686 $
260,779 $
26,309 $
287,089 $
26,948
314,036
$
(693,000) $
7
1 $
(570,316) $
2 $
(408,085) $
3 $
(287,451) $
4 $
(191,646) $
5 $
(95,526) $
6 $
(17,927) $
7 $
41,165 $
7
8 $
100,613 $
9 $
160,430 $
10 $
185,532 $
11 $
210,015 $
12 $
235,093 $
13 $
260,779 $
14 $
287,089 $
15
314,036
DEBT SCHEDULES
Scenario A Loan: Debt Schedule
Beginning Balance
Debt Service
Principle
Interest
Ending Balance
Year
1
$
$
$
$
$
Year
2
-
Year
$
$
$
$
$
Year
3
-
Year
$
$
$
$
$
Year
4
-
Year
$
$
$
$
$
Year
5
-
Year
$
$
$
$
$
Year
6
-
Year
$
$
$
$
$
Year
7
-
Year
$
$
$
$
$
Year
8
-
Year
$
$
$
$
$
Year
9
-
Year
$
$
$
$
$
Year
10
-
Year
$
$
$
$
$
Year
11
-
Year
$
$
$
$
$
Year
12
-
Year
$
$
$
$
$
Year
13
-
Year
$
$
$
$
$
Year
14
-
Year
$
$
$
$
$
Year
15
-
Year
$
$
$
$
$
Year
Disclaimer: This Unofficial Cash Flow Model is intended to provide non-residential entities that are considering the purchase and installation of solar energy equipment with a general understanding of possible financial implications of such purchase and installation. Those entities interested in learning
purchase and installation of solar energy equipment are urged to consult their own tax and financial experts. The information contained in the Unofficial Cash Flow Model may not be relied on by anyone for any purposes. Furthermore, the information contained in this model does not necessarily refle
Resources or the Commonwealth of Massachusetts, and reference to any specific method does not constitute an implied or expressed recommendation or endorsement of it. Neither the Department of Energy Resources nor the Commonwealth of Massachusetts make any warranties or representations
completeness, or accuracy of any processes, methods or other information contained, described, disclosed, or referred to in this model.
Finally, neither the Department of Energy Resources nor the Commonwealth of Massachusetts makes any representation that the use of any product, apparatus, process, method, or other information will not infringe privately owned property rights and assumes no liability of any kind or nature for any
resulting from, or occurring in connection with, the use of information contained, described, disclosed, or referred to in this Unofficial Cash Flow Model.
242724786.xls
10
11
12
13
0.00%
0.00%
0.00%
0.00%
0.00%
242724786.xls
Year
16
211,263
Year
17
210,207
Year
18
209,156
Year
19
208,110
Year
20
207,069
52,663 $
53,971 $
55,312 $
56,687 $
58,096
$
$
$
$
$
52,663 $
$
$
53,971 $
$
$
55,312 $
$
$
56,687 $
No
$
$
$
$
$
$
$
$
$
$
$
No
(5,481)
(5,481)
47,182
47,182
47,182
(14,862)
(4,718)
27,601
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
(5,989)
(5,989)
50,698
50,698
50,698
(15,970)
(5,070)
29,658
$
$
$
$
$
$
$
$
$
$
$
58,096
Yes
(6,169)
(60,000)
(66,169)
(8,073)
(8,073)
(8,073)
2,826
807
(4,440)
29,658
29,658
$
$
$
(4,440)
(4,440)
No
(5,645)
(5,645)
48,326
48,326
48,326
(15,223)
(4,833)
28,271
$
$
$
$
$
$
$
$
$
$
$
No
(5,815)
(5,815)
49,498
49,498
49,498
(15,592)
(4,950)
28,956
$
$
$
27,601 $
$
27,601 $
28,271 $
$
28,271 $
28,956 $
$
28,956 $
$
$
$
$
$
$
$
$
$
$
$
$
27,601 $
341,638 $
28,271 $
369,908 $
28,956 $
398,865 $
29,658 $
428,523 $
(4,440)
424,082
$
$
16 $
341,638 $
17 $
369,908 $
18 $
398,865 $
19 $
428,523 $
20
424,082
Year
16
$
$
$
$
$
Year
17
-
Year
$
$
$
$
$
Year
18
-
Year
$
$
$
$
$
Year
19
-
Year
$
$
$
$
$
Year
20
-
Year
$
$
$
$
$
Year
hose entities interested in learning more about the financial implications of the
model does not necessarily reflect the views of the Department of Energy
any warranties or representations, expressed or implied, as to the usefulness,
lity of any kind or nature for any loss, injury, or damage directly or indirectly
242724786.xls
Definitions
Back
Kilowatt-hours
(kWh)
Back
Solar System
The solar photovoltaic (PV) system. This includes your panels (modules), inverte
utility.
Estimated Optimal
Annual Generation
(kWh)
Back
kilowatts (kW)
The best case scenario for how much electricity a solar PV system will produce.
electricity depending on several factors. For example, a system will produce les
roof) than if they are on an axis that tracks the sun throughout the day. Another
system is able to face due south, the more it should produce. Tilt angle also imp
tilt is to its latitude the more it will produce. An optimal system in Massachusetts
degrees) and has a tilt of 42 degrees.
Kilowatts are a measure of power. A kilowatt is 1,000 watts. In this case, it desc
single solar PV panel might be rated at 180 watts. If a system uses 10 panels ra
will be 1800 watts, or 1.8 kW.
Back
This is a ratio between the amount of energy produced by your solar PV system
production capability. A 12.8% net capacity factor is average for solar PV system
by the angle of the system, its orientation, and the amount of shading. If a solar
every day, 24 hours per day at the optimal tilt and orientation with no shade then
capacity factor, in other words, it would produce its rated output.
Back
Annual Production
Degradation
Over the course of the life of the PV system, its production capability will decreas
time. Our default assumption is that this degradation will be 0.5% per year.
Back
Depreciation Life
Back
Electricity Revenue
(Avoided Costs)
This is the price per kWh that you will save on your electricity bill using this solar
this is a state average price for electricity.
Back
Electricity Revenue
(Avoided Costs)
Annual Adjustor
This model assumes that the cost of electricity will increase at 5% per year, there
electricity costs will also increase at 5% a year.
Solar Renewable
Energy Certificate
(SREC) Auction Price
Solar Renewable Energy Certificates (SRECs), also known as green tags, Solar
environmental commodities in Massachusetts which represent proof that 1 mega
generated from an eligible renewable energy resource. These certificates may h
traded so that the owner of the SREC can claim to have purchased renewable e
$.285/kWh, which is the price owners will receive for their SRECs if sold through
Account.
Back
The model uses a default term of 10 years. This term is based upon the length o
projects qualified in 2010 will receive. All projects with an Opt-In Term of 10 year
during their Opt-In Term by depositing them in the end of year Solar Credit Clear
is expected to be a measure of last resort for projects that have not signed bilate
that are required to purchase SRECs by the end of the compliance year.
Back
SREC Revenue
Annual Adjustor
This models allows the value of RECs to change by this percentage each year
Back
Back
Back
The price of SRECs as agreed upon in a bilateral contract with a compliance ent
The term of the bilateral contract with a compliance entity or other entity purchas
Back
Future Inverter
Replacement Cost
Back
Annual Generation
(kWh)
This is the estimated amount of energy that your solar PV system will produce in
Back
Total System Cost includes all elements of the installation including design, equi
etc. In the case of taxable commercial entities, the Total System Cost should inc
equipment
m is based upon the length of the Auction Opt-In Term that all
h an Opt-In Term of 10 years will be eligible to sell SRECs generated
d of year Solar Credit Clearinghouse Auction Account. The Auction
s that have not signed bilateral contracts with compliance entities
he compliance year.
hanges the direct current (DC) electricity from the PV array into
s or any AC load. The life of a solar PV system's inverter is less than
laced during the lifetime of the system which can be 25 years or
e the inverter will be $0.75/watt.