Project Finance Modelling For Renewable Energy

Create, use and analyse a project finance model for the renewable energy industry

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A two-day course

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Creating Models with Inputs & Assumptions

Best Practice Modelling

Best practices
Creating flexibility
Techniques to make modelling easier and faster
Separation of inputs, calculations, and outputs
Use of flags to control timing factors
Use of switches to allow option selection
Keeping control of versions
Making the model robust
Common mistakes
Practical: Review an existing model to check for compliance with best practice

Operating Model

Modelling production and sales volumes
Use of offtake agreements and pricing assumptions
Building up other operating costs
Building in efficiency and availability factors
Practical: Create an operating model with revenue, production & operating assumptions

Capital Expenditure in a Renewable Power Generation Project

The build-up of construction costs for the generating assets, grid connections, and other capital expenditure
Using lookup functions to make capital expenditure timings flexible
Renewables financial modelling includes building in sensitivities for potential changes in costs
Calculating the depreciation of the resulting capital assets
Practical: Adding CAPEX and depreciation schedules to the model

Project Financing and Cash Flow for a Renewable Power Project

Loan finance in a renewable energy project
Interest rates and repayment terms
Debt fees
Cash flow waterfall for funding flows
Project finance debt amortisation schedules
Debt Service Reserve Accounts (DSRA) in project finance
Exercise: Add a loan schedule that will feed into the model's balance sheet, cash flow, and income statement

Project Financing and Cash Flow for a Renewable Power Project

Tax and Dividends

This stage of the renewable energy financial modelling course transitions into the treatment of tax and dividends within project-level cash flow models.

Overview of modelling techniques for tax
Modelling cash available for distribution
Modelling dividends from the project with typical debt covenant constraints
Practical: adding tax and dividend calculations into the model.

Ratios

Ratios and bank covenants in a power generation project
Mechanics of modelling typical project finance ratios:
- Debt service cover ratio (DSCR)
- Loan life/project life cover ratio (LLCR / PLCR)
Using the DSCR to create a sculpted debt repayment profile
Practical: Add ratios to the model and adjust the dividend calculations so they are constrained by covenants based on debt ratios.

Discounted Cash Flow (DCF)

Cost of capital:
- Cost of debt
- Cost of equity
- Weighted average cost of capital (WACC)
Methods of calculating the valuations of projects
Producing an equity valuation using DCF
Practical: create a valuation of the equity in the model

Sensitivity Analysis for a Renewable Energy Project

Defining break-even in a project
Stress-testing a project finance model
Varying inputs to assess the effect on results
Using Goal Seek to determine assumptions for break-even
Excel tools to assist with sensitivity analysis:
- Goal seek
- Camera
- Data tables
- Scenario manager
Exercise: Add break-even calculations, data tables, and scenarios to the model.

Wrap-Up

Q&A
Further reading

The project finance modelling for renewable energy training course is delivered by an expert backed by three decades of hands-on expertise spanning multiple areas of the finance sector. Since 2005, he has delivered sessions for numerous (major) international training providers.

Having trained as a Chartered Accountant at KPMG in South Africa and New Zealand, he moved into industry with Ford Motor Company, holding positions in financial analysis, budgeting and forecasting. When appointed as Sales Planning Manager, our expert became responsible for forecasting models, production planning and supply logistics. He joined a multinational private consultancy group in Australia as General Manager of Finance, where he oversaw a period of significant organisational change whilst leading the group through a financial turnaround.

For the past 21 years, our specialist has worked as a freelance financial modeller, analyst and trainer for a range of blue-chip clients. Assignments including; Financial modelling for two major LNG projects in the Middle East, numerous renewable energy projects in both Europe and developing countries, structured financing for a large-scale property development, restructuring and outsourcing projects in the retail gas sector, PPP transactions in the utilities, health and support services sectors.

With an extensive accounting background, Redcliffe’s course leader brings accounting knowledge and analytical skills to every session. He has gained vast financial modelling experience in gas production, electricity generation, energy retailing, waste processing and property development sectors.

This trainer has built financial models across central government departments, retail enterprises, and high-volume online environments. His experience includes creating and applying models to support commercial negotiations, analyse risk, test scenarios, and forecast outcomes—skills directly informing his expertise in finance modelling for renewable energy projects.

Finance Modelling: Renewable Energy Knowledge Objectives

Learn best practices in model structures and logic
Build a complete financial model for a renewable power project using a phased and systematic approach
Create flexible revenue, production and cost forecasts
Add flexible capital expenditure profiles into the model
Include financing structures
Discover model dividend distributions to equity shareholders
Discuss bank ratios, debt covenants and model inclusion
Learn to calculate the weighted average cost of capital (WACC)
Value the project using discounted cash flow measures
Use Excel tools to highlight risk areas, particularly in sensitivity analysis

Project Finance Professionals. Individuals working in banks, investment funds, development finance institutions, or advisory firms who analyse, structure, or finance renewable energy projects.
Renewable Energy Project Developers. Those who plan, evaluate, or deliver renewable energy projects need to better understand how the structure, funding and cash flows of projects impact their viability.
Model Auditors. Auditors involved in reviewing renewable energy projects who need an overview of best practice in model-building and review.
Credit and Risk Analysts. Analysts in commercial and investment banks who evaluate and structure project finance funding, debt structures, covenants, and risk sensitivities within renewable energy projects.
Government, Public Sector, and Regulatory Professionals. Public sector employees who are responsible for energy procurement, PPP frameworks, or regulation of the renewable energy sector would benefit from understanding how project finance works in the sector.
Engineers and Technical Specialists in Commercial Roles. Individuals with technical backgrounds in energy or engineering who need to better understand financial modelling and project evaluation criteria in the renewable energy sector.
Consultants in Energy, Infrastructure, and Sustainability. Advisors to clients in the renewable energy sector who advise on feasibility studies, due diligence, or project structures.
Graduates and Early‑Career Professionals. Graduates with foundational finance or Excel skills who want to improve their financial modelling skills, possibly to specialise in renewable energy or project finance.

Finance modelling for renewable energy projects is designed to help analysts create and use models on a consistent and focused basis for the renewable power generation industry.

Aims
Participants to create, use and analyse a project finance model, specifically for the renewable energy industry. Completed by reviewing best practices in model structures, participants will build up the calculations stage-by-stage, creating an entire model. Using Excel tools, we will analyse outputs, highlight areas of risk and perform sensitivity analysis.

Methodology
Learning methods are practical, with each section covered briefly as a module in a traditional classroom style. The real learning experience is found in the exercises within each module. Suggested solutions to each stage are provided for discussion, whilst participants are encouraged to review their work independently. Further supporting materials and additional exercises are available for further post-course learning, with ongoing support from the facilitator.

Practical Exercises
A big focus of renewables financial modelling is learning through experience. This is why we create an entire model from scratch. Starting with basic assumptions and input data, participants will build a model with financial structures, inflation, cash flow waterfall, tax and dividends, equity returns and valuations, ratios and cover factors, and sensitivities.

Headlines

Learn how to utilise best practice financial modelling in structure and techniques
Build flexible models to accommodate change
Build funding structures and cash flow waterfalls
Effectively use model outputs – ratios, sensitivity analysis, scenarios
Create and use an entire model for a renewable energy project