Financial Analysis

The most important economic results such as return on assets and the annual feed-in tariff are listed here.

Overview of results

System data

  • Grid feed-in in the first year (incl. module degradation)
    For the profitability calculation, the grid feed-in is reduced by the following factors compared to the simulated grid feed-in, if applicable
    • Module degradation
    • the P90 calculation
    • the hours with a negative electricity exchange price (applies in Germany in accordance with the Solar Peak Act)
  • PV Generator Output
    The output of the system results directly from the planning. This value is decisive for many tariffs.
  • Assessment Period (Input)
    The value entered in the Economic parameters for the period under consideration
  • Interest on capital
    The value entered in the Economic parameters for the interest on capital

Start, duration and end of remuneration

  • Start of Operation of the System
    Date of commissioning of the PV system by the grid operator
  • Remuneration period Basis
    The basic remuneration period of the tariff according to which the feed-in is remunerated. If there is more than one tariff, the longest period of the tariffs is specified.
  • Extension of last calendar year - (only for locations in Germany)
    In the case of the German Renewable Energy Sources Act (EEG), systems whose value to be applied is determined by law are remunerated until the end of the last calendar year. This means, for example, that if a plant goes into operation on 1 March 2025 and is then remunerated for 20 years as standard, the subsidy is automatically extended until the end of December 2045 (instead of only until the end of February 2045).
  • Compensation period (German Solarspitzengesetz) - (only for locations in Germany)
    According to the so-called Solar Peak Act (amendment to the Energy Industry Act of March 2023), hours in which the exchange electricity price is negative are not remunerated. These hours are recorded and converted into a compensation period by which the remuneration is extended.
  • Remuneration period
    The compensation period is the sum of the Remuneration period Basis and any extensions.
  • End of remuneration
    The end of the remuneration is calculated from the Start of Operation and the remuneration period.

Economic Key Figures

  • Internal Rate of Return (IRR)
    Calculated using the internal rate of return method. The return on capital is increased until the capital value of the investment is less than zero.
    The result can be interpreted as follows:
    Investing equity in this investment is as good as investing equity in a bank at the interest rate of return.
  • Accrued Cash Flow (Cash Balance)
    The cumulative cash flow is the cash flow accumulated over the years. It is similar to the net present value, but the residual value of the investment is also taken into account.
  • Amortisation period
    Period of time until the capital value of the investment is positive for the first time.
  • alternatively: Minimum System Operating Period
    Period of time after which the equity invested and the present value of the loan payments have been repaid
  • Electricity production costs (LCOE)
    The electricity generation costs are the annual costs divided by the electricity generated. The annual costs are calculated from the present values
    • of the annual costs,
    • the one-off payments,
    • the loan payments
    • and the self-financing
      multiplied by the annuity factor.

The amortisation period and the Internal Rate of Return refer to the equity invested. Therefore, these results can only be calculated if the equity share is greater than zero. If the investment is partially debt-financed, PV*SOL® calculates a Minimum System Operating Period after which the equity invested and the present value of the loan payments have been repaid.

If the minimum term is greater than the amortisation period, the Minimum System Operating Period is displayed.

Payment Overview

  • Specific Investment Costs
    The specific investment costs are calculated by dividing the investment costs by the nominal output of the system in kWp.
  • Investment Costs
    The total investment costs of the system.
  • One-off payments
    The value entered in the economic parameters for the one-off payments.
  • Incoming Subsidies
    The value entered in the Economic parameters for the subsidies.
  • Annual Costs
    The value entered in the Economic parameters for the annual costs.
  • Other Revenue or Savings
    The value entered in the Economic parameters for the other revenues and savings.

The input of consumption-related costs is now obsolete and can be ignored.

Remuneration and savings

The selected feed-in and purchase tariffs are shown here in tabular form. The resulting values for the feed-in tariff and the savings in the first year are shown at the beginning of the section.

The specific feed-in tariff is calculated by dividing the feed-in tariff (in € per year) by the energy fed into the grid (in kWh per year).

Cash flow table

The cash flow table shows the income and expenditure over the period under review. Year 1 starts on the day of commissioning. The last year of the cash flow table can be part of a year. The exact period is shown in the first line of the cash flow blocks.

The cash flow is calculated on a monthly basis and displayed as annual values. See also - Calculation > Financial Analysis.

Degradation and price increase rates are applied monthly over the entire observation period. This is already done in the first year. The P90 calculation is also taken into account here.

Positions

The following payment sequences are available as cash flow positions:

Condition Remark
Investments only if no loan is selected Total investment costs
Operating costs visible if a value has been entered
Consumption costs visible if a value has been entered
Other costs visible if a value has been entered
One-off payments visible if a value has been entered One-off payments are not discounted, as they occur at the beginning of the year
Subsidies visible if a value has been entered Subsidies are not discounted, as they occur at the beginning of the year
Depreciation only if taxes are considered
Self financing only if a loan is selected that covers less than 100% of the capital Self financing is not discounted, as it occurs at the beginning of the year
Feed-in remuneration only if a feed-in tariff has been selected
Electricity Savings only for systems with electrical consumers
Other revenues or savings visible if a value has been entered
Loan repayments only if a loan has been selected
Loan interest only if a loan has been selected
Result before taxes only if taxes are considered Calculation see below
Tax refund only if taxes are considered
Result after taxes only if taxes are considered Calculation see below
Annual cash flow Calculation see below
Accrued cash flow (Cash Balance)
Accrued cash flow (Cash Balance) minus pending loans only if a loan has been selected

Calculation of Annual Cash Flow and Results Before and After Taxes

The calculation of the annual cash flow varies depending on the selected profitability parameters.

Without Considering Taxes

No loans, no taxes Loan without equity share, no taxes Loan with equity share, no taxes
Result before taxes n/a n/a n/a
Result after taxes n/a n/a n/a
Annual cash flow Sum of all listed positions Sum of all listed positions except one-off payments and subsidies Sum of all listed positions except one-off payments and subsidies

With Considering Taxes

No loans, with taxes Loan without equity share, with taxes Loan with equity share, with taxes
Result before taxes Sum of all listed positions except investments Sum of all listed positions except loan repayments Sum of all listed positions except self financing and loan repayments
Result after taxes Result before taxes plus tax refund Result before taxes plus tax refund Result before taxes plus tax refund
Annual cash flow Sum of all listed positions except depreciation and result before taxes Sum of all listed positions except one-off payments, subsidies, depreciation, and result before taxes Sum of all listed positions except one-off payments, subsidies, depreciation, and result before taxes

Calculation of Accrued cash flow (Cash Balance)

  • Accrued cash flow (Cash Balance) is the sum of annual cash flows.
  • Accrued cash flow (Cash Balance) minus outstanding loans is calculated as the cumulative cash flow minus all payments (repayments and interest) that are still due for the loan at that point in time.

Disclaimer / Note on Tax Aspects

The calculations and information contained in this software do not constitute tax advice. They are intended solely for general guidance and cannot replace individual consultation by a tax advisor.
We do not assume any responsibility for the accuracy, completeness, or timeliness of the presented tax-related impacts. Binding information and an individual tax assessment can only be obtained from a tax advisor or another person authorized to provide tax advice. Any liability for damages arising directly or indirectly from the use of the tax calculations is excluded.

See also