Kindly note that Part B $(1)$ and C $(1)$ and C $(2)$ answers using excel.

First tab $$ Energy prices data Second tab $$ Revenue Calc Third tab $$ NPV Calc, Fourth tab $$ Sensitivity Analysis

Part B:

Using the provided forecasted electricity prices data:

$1.($i$)$ Estimate the expected annual revenue from the solar project, assuming a fixed annual energy output of $5,000$ MWh$.$

$2.($ii$)$ Discuss how uncertainty in price forecasts could be incorporated into the revenue projections

$$

Part C:

Assume the following:

$$ Initial investment cost: $$2$ million

$$ Annual operating cost: $$100,000$

$$ Discount rate: $8\%$

$$ Project life: $10$ years

$1.($i$)$ Calculate the NPV of the project using your forecasted revenues.

$2.($ii$)$ Conduct a sensitivity analysis by varying the discount rate $(6\%,8\%$ and $10\%)$ and energy output $(4000$ MWh$,5000$ MWh$,6000$ MWh$)$

$3.($iii$)$ Based on your analysis, should the company proceed with the investment? Justify your answer.

$$

Date Forecasted Price $($$$/$MWh$)$

$202373\mathrm{.}83$

$202495\mathrm{.}46$

$2025103\mathrm{.}59$

$2026103\mathrm{.}59$

$2027103\mathrm{.}59$

$2028101\mathrm{.}55$

$202998\mathrm{.}62$

$2030100\mathrm{.}95$

$2031105\mathrm{.}45$

$2032104\mathrm{.}67$