Format: Online, on-demand streaming.
Length: ~ 2.5 hours.
This session delves more deeply into the financial concepts learned in the beginning session. Students will learn how to model expected cash outflows and inflows over time, how to calculate a project’s present value and other financial metrics, and how to generate compelling capital budgeting requests.
Who should attend:
Anyone attempting to evaluate and/or lobby for expense-reducing capital projects; project development roles (e.g., engineers, vendors, manufacturers’ reps); program managers; utility and/or regulator staffs attempting to set metrics for encouraging/approving energy projects; etc.
- Understand the differences between simple payback period (SPP), return on investment (ROI), internal rate of return (IRR), modified internal rate of return (MIRR), savings-to-investment ratio, net present value (NPV) and life-cycle cost analysis
- Know which of these financial metrics are appropriate for mutually exclusive versus non-mutually exclusive decision-making settings
- Understand when and how to migrate the discussion from “popular metrics” (e.g., SPP, ROI, IRR) to “proper metrics” (e.g., MIRR, SIRR, NPV) and how to explain the advantages of “proper” over “popular” to your prospects so that they appreciate the distinction and enthusiastically embrace proper metrics
- Calculate various financial metrics in the context of individual expense-reducing projects or packages of projects
- Explore the financial analysis of expense-reducing capital projects in landlord/tenant settings
- Moving From “Popular” to “Proper” Metrics to Drive Better Decisions
- Relationship Between Present Value and Future Value
- Finding the Right Numbers and Putting Them in the Right Place
- Building Intuition and Sanity-Checking Financial Analyses
- Applying the Metrics to Simple Scenarios
- Generating Financial Analyses for Packages of Projects
- Commercial Real Estate Effects: Who Pays/Benefits
- Funding Projects
- BONUS: Incorporating Business Acumen when Preparing Financial Analyses
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