The valuation of power generation and electricity assets is a complex task that requires an in-depth understanding of the energy sector. We conduct careful financial and economic analyses and apply our understanding of distinct energy markets to determine the appropriate value for the underlying asset. Our valuations are based on rigorous analysis of the power technology and its cost structure, the revenue drivers, and the regulatory landscape.
As damages experts, we have analyzed the electricity sector in Argentina, Bolivia, the Dominican Republic, Romania, Spain, Tanzania, Ukraine, and the United States. We have utilized income, market, and asset-based approaches to value power generating assets in these countries. Our work involves:
Evaluating how the electricity sector is regulated in the relevant country and assessing the impact of any changes to the existing regulations on the value of the underlying project;
- Studying how electricity prices are determined in the day-ahead and intraday markets in the relevant country;
- Analyzing the economic and financial terms of power purchase agreements and engineering, procurement and construction contracts;
- Estimating reasonable revenue and cost projections of power generating assets; and
- Determining the risk and uncertainty involved in the power generating operation.
We also have extensive experience in the valuation of renewable energy assets, with participation in several arbitrations relating to different forms of renewable energy: solar, wind, and hydropower. We are very familiar with the different support schemes for renewable energy and have studied the economic impact of modifications to these support schemes that may occur when a nation’s societal goals change. For instance, we have assessed the economic impact of policies that reduce the level of subsidies offered to renewable generators for the purpose of alleviating some of the financial burden on consumers and on public budgets.