The South African growing energy demand and load shedding has triggered the issue of energy security....

  

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The South African growing energy demand and load shedding has triggered the issue of energy security. The recent approval by the cabinet of 100 MW electricity production for independent suppliers has open opportunities. Star Energy as an investment company in energy sector has decided to grab this opportunity. They studied a portfolio of power generation through South Africa with the aim of selling it to Eskom Grid. The table below indicates data of the leading Renewable Energy technologies Star Energy has picked for evaluation in 10-year period project life: Parameters Technology Place of Operation Rated Capacity Capacity Factor Days in operation Output Capacity Output Capacity Total investment cost Operation Costs Units MW days MW MW.hr R billion R/kW.hr Wind Wind Western Cape 100 35.40 330 35.40 280 368 2.43 0.1540 Solar 1 Solar only North West 100 32 330 32 253 440 2.80 0.1582 Solar 2 Solar with back- up battery storage. Northern Cape 100 65 330 65 514 800 7.75 0.2448 Hydro Hydropower Free State 100 50.50 330 50.50 399 960 3.54 0.0447 The South African growing energy demand and load shedding has triggered the issue of energy security. The recent approval by the cabinet of 100 MW electricity production for independent suppliers has open opportunities. Star Energy as an investment company in energy sector has decided to grab this opportunity. They studied a portfolio of power generation through South Africa with the aim of selling it to Eskom Grid. The table below indicates data of the leading Renewable Energy technologies Star Energy has picked for evaluation in 10-year period project life: Parameters Technology Place of Operation Rated Capacity Capacity Factor Days in operation Output Capacity Output Capacity Total investment cost Operation Costs Units MW days MW MW.hr R billion R/kW.hr Wind Wind Western Cape 100 35.40 330 35.40 280 368 2.43 0.1540 Solar 1 Solar only North West 100 32 330 32 253 440 2.80 0.1582 Solar 2 Solar with back- up battery storage. Northern Cape 100 65 330 65 514 800 7.75 0.2448 Hydro Hydropower Free State 100 50.50 330 50.50 399 960 3.54 0.0447

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The questions require us to calculate the Weighted Average Cost of Capital WACC suitable for these projects and estimate the Net Present Value NPV of ... View the full answer