PROJECT ECONOMICS & FINANCE 58157-812 (21 - 25 June 2021)

The module focuses on how to finance a business opportunity (project) that can be isolated from the rest of a company’s business activities. Financing through a combination of debt and equity are discussed, based on the future profitability of the project where project cash flow is the main source of capital recovery and the project assets are the only collateral. The concepts of construction loans and public- private partnerships are discussed. A number of case studies will be covered in the module, including projects to construct a bridge, a satellite and a wind turbine farm.

Current module content:

  • Infrastructure and development finance: Sources of business finance and private sector project financing models.
  • Review of: time value of money / discounted cash flow / interest calculations.
  • Basic accounting statements (balance sheet, income and cash flow statements).
  • Costing and management accounting – theory / techniques and costing system concepts.
  • Ratio analysis, from basic ratios to the DuPont approach.
  • Economic analysis of investment decisions.
  • Market valuation (EVA and MVA).
  • Value drivers in the company, sustainability and the Balanced Scorecard.
  • The national accounts and economic growth.
  • Feasibility studies and techno economic analysis:
  • System identification, parameter identification, environment and system boundary
  • Definition, environmental scanning, system modelling and simulation concepts, modelling
  • Risk and uncertainty in infrastructure finance and project development.
  • Materials, labour and equipment: Impact of required service and quality levels. Cost estimation and cost controls of construction projects.
  • Revenue stream estimating and modelling. Financing models.
    • Renewable Energy Systems and characteristics
    • Grid code compliance
    • PV components and sizing
    • Storage components, eg. batteries
    • Microgrids and power flow
    • Network dynamics and stability
    • Economics of SG installations
    • Communications technology and selection