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1 Introduction
The SunWiz PV spreadsheet is intended to assist in the evaluation of the financial outcome resulting
from installation of a solar power system. It contains many graphs, tables, and charts that can assist
in conveying a sales message. It is intended for in-house use in solar power companies, but can easily
be extended, in recognition that most users of the tool wish to customize their own sales message.
There are restrictions placed upon fields that can be manipulated. This is done in order to protect the
novice user from inadvertently changing a cell containing an automatically-updating formula upon
which calculations depend. Cells that are user-modifiable are highlighted in yellow. Expert users
wishing to customize the spreadsheet may request a password that unlocks all cells. Alternatively, an
automatically-updating spreadsheet can be added that references cells within the supplied
workbook.
This user guide accompanies the MS Excel workbook. It consists of three parts:
1. An introduction to the features of the workbook, and an overview of the spreadsheets.
2. A step-by-step guide for beginners to operate the workbook.
3. Description of the major outputs from the spreadsheet, and their value in a sales pitch.
In addition, guidance is contained in comments within the spreadsheet, and in the “how to use” tab
at the start of the workbook.
Some familiarity with MS Excel is assumed. For those less-familiar with the operation of MS Excel, a
bar exists at the bottom of the Excel program (see image below) that allows users to switch between
spreadsheets (also referred to as “tabs”) in the workbook. As more tabs exist than can be displayed
on screen at once, use the arrows on the left ( < and >) to scroll the tabs left and right. To change tab,
simply click on the desired spreadsheet name across the bottom of the page.
Use the horizontal and vertical scroll bars to move around a single spreadsheet, and use the zoom to
enlarge the numbers on screen (see image below)
2 Workbook Features
The SunWiz PV Spreadsheet is designed to simplify the process of financial evaluation of a PV system
under a range of circumstances. It contains many complex formulae to calculate revenue, payback,
internal rate of return (“effective interest rate”), and cash flow. This ensures that solar businesses can
spend their time selling and installing, backed by a tool that accurately performs the calculations
they need to convince customers to purchase from them.
The SunWiz PV Spreadsheet contains:
· User-controllable:
- solar power system performance inputs,
- state of Australia,
- REC (renewable energy certificate) price,
- REC multiplier,
- REC zone,
- year of analysis,
- grid electricity price and annual increase,
- annual panel degradation, and
- premium price above Feed-in Tariff (FiT, also known as a “solar bonus scheme” in
some states).
· Automatically calculated:
- number of RECs,
- net or gross FiT, and
- remaining duration of Feed-in Tariff.
- Comparison of 6 solar power systems, with user-controllable solar power system
prices.
- Automatically calculated post-REC system customer prices.
- Automatically calculated annual revenue and simple payback.
- User-controllable range of (net FiT) export power percentage to help solar
businesses understand the sensitivity of payback to export.
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Or not, as the case may be
The return on investment is expressed in terms of Internal Rate of Return (IRR). While this can be
complex to understand and convey, put simply it’s the “effective interest rate on your investment”.
If the IRR is greater than the interest rate a bank will give you on a bond, then it could be considered
a sensible financial investment (depending on the risk involved in the investment).
Solar power could be considered a risky investment in states with net Feed-in Tariffs, as the revenue
can vary by factor three depending on a site’s daytime power consumption. Fortunately, this tool
substantially reduces this risk by calculating the likely amount of generated power that is export, and
thus the corresponding likely revenue, likely simple payback, likely true payback, and likely IRR. Of
course, a model is only as good as its assumptions and inputs, so use this tool wisely.
Otherwise all the graphs reflect the chosen system size for deeper analysis.
4 Overview Of Spreadsheets.
Cashflow Annual electricity Annual and cumulative flow of Demonstrate the insulation
consumption, loan cash based upon customer’s provided by a PV system from
amount, loan term, and electricity bill and solar rising electricity prices, and
interest rate. generation with various export possible profitability.
percentages, with and without a
loan, for the system chosen in
“Inputs” tab.
Projected As specified in “Inputs” Graphs the increasing costs of Shows the expected rise in
Electricity Price tab. electricity against the steady costs electricity prices over 20 years,
of the PV system. against the steady price of a PV
system.
Price Breakdown As specified in “Inputs” Graph of the effective price paid Visually convince commercial
tab. by commercial customers after customers of the savings they
GST, RECs, and depreciation is receive.
accounted for.
Net FiT Payback As specified in “Inputs” Graph of commercial and Demonstrate to commercial
and IRR tab. residential payback, and customers that good benefits
commercial IRR incorporating are available, and even greater
rising cost of electricity and panel benefits are within reach if they
degradation, as they vary with export more power. Relevant to
export power percentage. Net FiT only.
Gross FiT payback As specified in “Inputs” Bar chart of commercial and Demonstrate the favourable
IRR Chart tab. residential payback, and outcomes available under a
commercial IRR incorporating gross FiT.
rising cost of electricity and panel
degradation.
Likely Net FiT As specified in “Inputs” Graph of the likely payback from Provide customers with a more-
Payback Chart tab. a range of system sizes, under accurate and realistic estimate
three levels of annual power of their revenue and payback
consumption. that is based upon industry
measurements. Visually
demonstrate the value of
investing in a larger system, and
of saving daytime energy use.
Relevant to Net FiT only.
Gross Fit Payback As specified in “Inputs” Graph of the likely payback from Visually demonstrate paybacks
Chart tab. a range of system sizes. under Gross FiT.
Net Fit Solar As specified in “Inputs” Graph showing annual revenue Shows hows much revenue a
Revenue tab. over 20y period for the selected system can produce annually
system size, using a variety of over a 20 year period.
export values.
Gross FiT Solar As specified in “Inputs” Graph showing Revenue on the Shows maximum amount of
Revenue tab. selected system size if export was revenue a system can produce
100% annually over 20 year period.
Net FiT Cumulative As specified in “Inputs” Graph showing revenue Shows hows much accumulated
Revenue tab. accumulated over a 20 year revenue a system can produce
period, for the selected system over a 20 year period.
Spreadsheet Inputs Outputs Value
Annual Cash Flow None Graph of the annual cash flow Visually demonstrate annual
– with loan based upon customer’s electricity electricity spent over 20 years,
bill and solar generation with and comparative profit if a PV
various export percentages, system is purchased via loan.
assuming customer takes a loan.
1kW solar Output Location, load Profile. Calculates hourly energy Hourly system performance.
generation for a 1kW system,
includes state variables.
Net FiT output Day of year, generated Energy consumption and export Daily system performance.
graph from 1kW solar output tab. using a 1.5 kW system, for each
day of the year.
RECs Zone, Fits, Location, load profile for Cash outcomes comparing system REC's received over the year.
Exports. each system size. sizes and REC zones.
5 Step-by-step Operation and Interpretation
Note that All Input fields are Marked In Yellow
1. Use the drop-down arrow to select the size of the system to be analysed in detail from the
range of system sizes below
2. Enter a Range of up to 6 system capacities to demonstrate to your client
3. Enter the predicted actual performance (If the system is shaded, non-north facing, or flat
pitched, adjust the performance here accordingly).
4. Enter the annual degradation of the system here, 1% is standard.
6. Enter the state of installation and Location (SA, ACT, VIC, NSW, QLD, TAS, NT, WA). This will
automatically select the feed-in tariff rate, type (net or gross), and the remaining number of
years of premium FiT1. If a state with a gross FiT is selected (ACT or NSW), specific analysis
and graphs are presented. Graph titles automatically update to indicate whether they are
relevant to the type of applicable FiT. Select “NA” if your customer is ineligible for the FiT –
they will then receive a net 1-for-1 FiT at the escalating electricity price, plus any premium
FiT entered below.
7. Enter the year of analysis. The remaining FiT duration is automatically calculated. WA
remains at 10 years duration, regardless of start date, until being reduced in 2021 (after
which the price of electricity is likely to be higher than the FiT anyway)
8. Enter the REC multiplier, which should be 5, 4, 3, 2, or 1, depending on the year and month
of installation (see image below).
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9. Enter the REC Zone, which is based on the postcode of installation (see
http://www.orer.gov.au/sgu/index.html for details).
10. Type the REC price, including GST.
11. Adjustment - If the customer receives a premium rate above the state-mandated FiT (some
electricity retailers such as Origin provide an additional $0.06/kWh), enter it here. Price
should include GST.
12. Enter your tax bracket and GST% here. If the system is to be sold to a commercial customer,
enter the tax bracket of the business to which it’s sold. Most commonly this is 30%. If the
system is to be sold to a residential customer, enter 0% in this cell. This cell influences the
post-tax cost and revenue (including value of depreciation).
13. If the system is to be sold to a commercial customer that is registered for GST, enter “10%”.
Otherwise enter 0%. This cell influences the post-tax cost and revenue.
14. Enter the fixed electricity import price $0.18/kWh (incl GST). This should be the ‘average’
price paid by the customer, as reflected on their bills. Time-of-use tariffs are not supported in
this version of the tool.
15. Enter the compounding growth in electricity price from year to year
16. Enter any additional yearly PV related costs including GST here, e.g. maintenance costs or
extra equipment needed. This affects the PV revenue, cashflow, and true payback
calculations.
17. Enter any extra yearly bill related costs here (such as service charges un-related to electricity
consumption levels), including GST. This affects the cashflow and net financial position
graphs for both ‘non PV’ and PV solution. It doesn’t affect the PV revenue graphs.
18. Enter Loan amount. (Deposit amount is automatically calculated as purchase price less loan
amount). Hint: Set “=C51” to automatically adjust to the full system price
19. Enter loan term.
20. Enter interest rate of loan.
The effective Post Tax annual Payment is calculated
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1After the FiT ends, the power price returned reverts back to the import electricity price (i.e. “1-for-1”)
Step 9 – Power Export Search Space
21. Referring to Section 3.1 or the table below, select the preferred method of export power
methods (custom, load profile, measured). The corresponding data from the relevant column
is transferred across to the “Used” column
d. Enter the site’s hourly electricity consumption profile for an average day in each month of
the year (in Watts). You may wish to copy and paste an example residential load profile from
row 100 onwards
Note that the table below reflects the analyses load profile (after scaling if scaling is selected).
This tab facilitates investigation of a range of power exports under a net FiT. First-year revenue and
simple payback (upfront cost divided by first-year revenue) is presented numerically for the selected
range of power export percentages. If the simple payback is longer than the remaining FiT duration,
the cells are highlighted in red.
Calculations are made from data entered on the input page and show -
The effect of GST, RECs, and 20 years of depreciation on the effective net system price
Pre-tax and post-tax revenue for commercial customers. Note the tax savings on the upfront
purchases imply taxed income from the PV array, as illustrated in the example at the end of
this list.
Simple Residential payback adjusted for FiT duration
Simple Business payback adjusted for FiT duration. The payback is calculated as the effective
out-of-pocket cost (system price post GST, post tax break, post 20 years of depreciation)
divided by the post-tax revenue.
Business IRR is the “effective interest rate on the investment”, known as the Internal Rate of
Return. This is calculated based upon the discounted cash flow analysis presented on the
“DCF analysis” tab. The IRR takes into account FiT duration, panel degradation, and power
price increases.
Elements of this table are presented graphically on the “Payback&IRR” tab for net FiTs. If a
gross FiT is selected, the “GrossFiTPaybackChart presents these. Price breakdown is
presented on the “PriceBreakdown” tab.
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Whether the business declares this GST liability or not is up to them. Do not assume they
don’t declare this tax, as this may be taken as providing advice to evade tax obligations
6.3 Customer Output Residential/Commercial
The Customer Output Tab presents a summary of the data contained within the spreadsheet. This is
useful for printing a tailored assessment for a customer. The only inputs that should be adjusted on
this sheet are the customer details. The remaining cells should be adjusted on the Inputs Tab.
The second graph shows the same data, projected to larger system sizes, with data points at each of
the system sizes selected in the “Inputs” tab.
This data is only relevant for residential systems, and ignores the likelihood that a house with a roof
large enough to hold a 10kW system would have very high power consumption.
The value of the graphs lies is in demonstrating the large increase in exported power from a small
increase in system size, or from a decrease in power consumption. This is translated into simple
payback (highlighted red where the simple payback exceeds the remaining FiT duration), and
illustrated graphically in the ‘LikelyNetFitPaybackChart’ tab.
Note that some chart titles will automatically update, and remind you that they are irrelevant if a
gross FiT is selected.
6.5 Likely Gross FiT Payback
This tab shows the same information as the Likely Net FiT Payback tab, except for a gross FiT (with
100% of the energy generation being exported). Note that some chart titles will automatically
update, and remind you that they are irrelevant if a net FiT is selected.
Note that the PV-Related additional costs affect this analysis; the Bill-related additional costs do not.
The electricity bill, solar revenue, and depreciation are calculated for each of 20 years, accounting for
panel degradation and the increase in the price of imported electricity. Any PV-related cost is
reflected in the electricity revenue, and any bill-related costs are reflected in the Electricity cost.
Accumulated cash flow is presented in the ‘net position – self funded’ table, assuming the full cost of
the system is paid upfront. This cash flow is presented graphically in the “Net Position – Self Funded”
tab.
Annual cash flow is presented in the ‘annual cash flow – with loan’ table, with details of the loan.
This cash flow is presented graphically in the “Annual Cashflow – self funded” tab.
Accumulated cash flow is presented in the ‘net position – with loan’ table, with details of the loan.
This cash flow is presented graphically in the “Net Position – with loan” tab.
Annual cash flow is presented in the ‘annual cash flow – with loan’ table, with details of the loan.
This cash flow is presented graphically in the “Annual Cashflow, with loan” tab.
6.9 Projected Electricity Price
6.9.1 Description
This graph shows the electricity price that will occur if the assumptions about annual compound
growth entered in the inputs hold true.
6.9.3 Interpretation
The red line displays the annual compound electricity price growth entered in the inputs page. The
blue line shows the resulting average electricity price paid.
6.10 Price Breakdown
6.10.1 Description
This graph shows the breakdown of solar system price from the full RRP, less GST, RECs, and
depreciation over 20 years.
6.10.3 Interpretation
This is a cumulative bar chart
Remember that if you sell on post-tax cost, you should assume post-tax revenue (as explained
earlier)
6.11 Net FiT Payback and IRR
6.11.1 Description
This graph shows the simple payback, true payback, and Internal Rate of Return for the nominated
system over the used range of export power percentages.
6.11.3 Interpretation
Read payback (green and purple lines) off the left axis. Read IRR (blue line) off the right axis. Each of
the used export power percentages has a marker.
The True payback is often less than the simple payback for low export percentages on a net FiT. This
is because financial outcome on systems with low exports is more affected by rising electricity prices
than systems earning mostly FiT (which remains constant each year). The simple payback can by
shorter than the true payback as it doesn’t account for depreciation or degradation.
6.12 Gross FiT Payback and IRR chart
6.12.1 Description
This graph shows the simple payback, true payback, and Internal Rate of Return for the nominated
system over the used range of export power percentages. This is the Gross-FiT equivalent of the Net-
FiT graph described in Section 6.11
6.12.3 Interpretation
Read payback (green and red bars) off the left axis. Read IRR (green line) off the right axis.
6.13 Likely Net FiT Payback Chart
6.13.1 Description
This graph shows the likely simple payback for the chosen range of system sizes using the measured
export calculation method.
6.13.3 Interpretation
This graph shows the likely simple payback of 6 systems, by evaluating the likely amount of power
exported from each system (based on industry measurement and calculations presented in the
“Likely net-FiT Payback” tab), the likely amount of revenue can be calculated, and thus the likely
payback.
6.14 Gross FiT Payback Chart
6.14.1 Description
This graph shows the likely simple payback for the chosen range of system sizes on a gross FiT. This is
the gross FiT equivalent graph to that shown in Section 6.13.
6.14.3 Interpretation
This graph shows the simple payback of 6 systems
6.15 Net FiT Solar Revenue
6.15.1 Description
This graph shows the post-tax annual revenue from electricity sales of the selected solar power
system, for the selected range of export percentages on a net FiT.
6.15.3 Interpretation
The competing effect of panel degradation and increasing electricity prices can be seen in this graph.
Revenue under 100% export declines with degradation until (under the assumptions of a 7% annual
increase in electricity price), export power has the same value of the import power. At this stage, the
electricity price growth is greater than panel degradation, so the curve trends upwards. Western
Australian customers might also see the end of the FiT displayed clearly on their graph.
6.16 Gross FiT Solar Revenue
6.16.1 Description
This graph shows the post-tax annual revenue from electricity sales of the selected solar power
system on a gross FiT.
6.16.3 Interpretation
The end of the NSW FiT is clearly seen in this graph.
6.17 Net FiT Cumulative Revenue
6.17.1 Description
This graph shows the cumulative post-tax position of a customer that has bought the selected solar
power system, for the selected range of export percentages on a net FiT.
6.17.3 Interpretation
True payback occurs when the relevant line crosses the x-axis.
6.18 Gross FiT Cumulative Revenue
6.18.1 Description
This graph shows the cumulative post-tax position of a customer that has bought the selected solar
power system, for a gross FiT.
6.18.3 Interpretation
True payback occurs when the line crosses the x-axis.
6.19 Net Financial position nFiT
6.19.1 Description
This graph shows the cumulative post-tax position 20 years after a customer that has bought the
selected solar power system, for a range of export percentages under a net FiT.
Note that for a small system size, PV installation may still result in a negative financial position
(although still better than no purchase). This is because power production is far less than power
consumption, and thus the customer’s electricity bill isn’t fully offset (especially considering
increased electricity prices). Thus this graph can be used to up-sell to a system that covers more of
their energy usage.
6.19.3 Interpretation
Pretty straightforward: Would you rather be on the left-most bar, or one of the other bars?
6.20 Net Financial Position qFiT
6.20.1 Description
This graph shows the cumulative post-tax position 20 years after a customer that has bought the
selected solar power system, for a gross FiT.
Note that for a small system size, PV installation may still result in a negative financial position
(although still better than no purchase). This is because power production is far less than power
consumption, and thus the customer’s electricity bill isn’t fully offset (especially considering
increased electricity prices). Thus this graph can be used to up-sell to a system that covers more of
their energy usage.
6.20.3 Interpretation
Pretty straightforward: Would you rather be on the left-most bar, or the right-most bar?
6.21 Net Position – Self Funded
6.21.1 Description
This graph show the customers cumulative expenditure on electricity and solar power, taking into
account any additional PV-related and bill-related costs. This is similar to the PV revenue graph
shown in Sections 6.15 and 6.16, but includes money spent on electricity consumption.
6.21.3 Interpretation
This graph presents a cumulative position, which is simpler to interpret than annual cashflow
presented later.
Simplistically, the downwards going curve shows that not investing in a PV is bad, especially when
compared with the upwards curve that results from a PV purchase. Payback is where the green line
crosses the line associated with the expected PV export.
Note that installation of a small system at a location with high power consumption may result in a
graph in which all lines trend downwards. Similar may occur in NSW after the end of the FiT. Though
still better off than not purchasing a PV system, this may encourage customers to buy a larger
system.
6.22 Annual Cash Flow – Self Funded
6.22.1 Description
In contrast to the cumulative graph presented in Section 6.21, this graph shows the annual cashflow
resulting from PV installation under various amounts of power exports, as compared to the
customer’s electricity bill. It shows post tax (post depreciation offset) cashflow.
If a customer isn’t creating enough revenue to offset their bill, the lines may slope downwards as the
electricity price rises. This can be a good incentive to purchase a larger system (or add more panels
at a later date).
6.22.3 Interpretation
Generally the lines with high levels of export power slope downwards because of panel degradation.
Upward sloping lines associated with low power export can demonstrate that electricity prices are
more than compensating for panel degradation. Lines can also slope downwards due to
depreciation, which results in a large tax savings in early years, and small tax savings in later years.
6.23 Net Position – With Loan
6.23.1 Description
This graph shows net financial position if the customer takes out a loan to pay for their system.
Similarly to Section 6.21, this graph shows cumulative expenditure.
6.23.3 Interpretation
This can be a complex graph, depending on the system size, customer’s consumption, loan term, and
interest rate. When the line associated with the customer’s purchase sits above the green line, then
they’re ahead (paid back). In the example above, they’re ahead from the beginning.
6.24 Annual Cash Flow – With Loan
6.24.1 Description
This graph shows annual cash flow associated with the net financial position associated with taking
out a loan, as compared to the cumulative position that was shown in 6.23.
6.24.3 Interpretation
This can be a complex graph, depending on the system size, customer’s consumption, loan term, and
interest rate.
6.25 1kW Solar Output
This tab is mostly used for load profile export calculation purposes. It shows the simulated output
from a north-facing 30°-inclined 1 kW solar power system for each of Australia’s capital cities (as
simulated using Solar Advisor Model). This output is then scaled by the system size to calculate the
export, when compared to the load. There is also a column that allows custom solar power system
to be entered (e.g. from a different location). SunWiz can provide hourly solar radiation data for the
following locations upon request.
6.26.1 Description
This graph shows the (scaled) load profile used in the export calculation of the same name.
6.27.1 Description
This graph shows the various categories of electricity flows in a net FiT based upon the entered load
profile, and the chosen day of the year (cell B2). The output from solar power system results first in a
reduction in import power, then the export of electricity to the grid.
Sales messages should be targeted towards the customer’s wants and needs. A customer that can
only just afford a 1.5 kW system needs a different sales pitch to someone interested in maximising
the value of their investment by purchasing 10 kW. Customers should always buy as large a system
as they can afford, and upgrade their inverter if they want to expand in the next 3 years. Consider a
three-pronged sales message:
Price Self-
Zero Bill
Driven Cover at least a third Sufficient Receive cheques
A 1.5 kW system of your consumption from your electricity
maximises the and you should have retailer by covering
Government funding no electricity bill for your annual energy
the next 5 years. consumption
7.1 SunWiz Services: Expert Solar Advice Can Help Your Business Shine!
SunWiz is a specialist solar energy consultancy that can help your business grow.
Award-winning PV
Tender Preparation Procurement Advice
System Design
Independent Tender Business Opportunity Identification System Performance Monitoring
Evaluation and Evaluation and Reporting
Installation training, supervision
Technology Evaluation Feasibility Studies
and sign-off
7.2 Export Calculation Products to Support Your Business
7.3 The hardest part about selling COMMERCIAL solar power is now solved!
Commercial solar power customers need evidence that their investment is wise. Installing a solar
power system can improve businesses’ environmental image, but most won’t spend $10,000+ unless
it’s financially justifiable. Take that thumb out of the air - give them a true calculation of their solar
revenue and their return on investment.
SunWiz takes your customer's electricity bills, synthesises 8700 hours of electricity
consumption based on an agreed hourly load profile, and calculates revenue for each hour
of the year, based on local solar radiation data. This answers the questions: