Photovoltaic investment model - inflation
Hi,
I need to do a model for a photovoltaic investment. I have added yearly inflation of 1.5% to the costs, do I also need to add 1.5% to the revenues? The revenues are fixed at 0.085€/kWk which is a government incentive in Italy.
Thanks
porcoddue quanto cazzo spammi
anyway - yes I would assume CPI indexation.
On both revenues and costs? 1.5% reasonable ?
It depends on the contract. Contracts in the US can be either fixed-price or escalating with inflation. A “fixed price” contract means that it’s NOT escalating for inflation, so do not increase revenues based on inflation if you’re dealing with a fixed price PPA.
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