Investment and Financing Perspectives for a Solar Photovoltaic Project

Abstract

In this work we illustrate a simple logical framework serving the purpose of measuring value creation in a real-life solar photovoltaic project, funded with a lease contract, a loan contract and internal financing (i.e., withdrawal from liquid assets). We use the projected accounting data to compute the value created. We assess the project from both an investment perspective (operating assets and liquid assets) and a financing perspective (debt and equity). Furthermore, focusing on value creation for equity-holders, we calculate the expected contribution on shareholders wealth increase of operating and financing activity. In particular, we highlight the role of the distribution policy in financial modeling, by underlining the strict logical connections between estimated data and financial decisions.