A solar portfolio analyst breaks down the three variable categories he tracks in roll-up models: commercial terms like tariffs and contractor costs, technical assumptions like degradation rates and availability, and financial structures like leverage and DSCR. Consistency across projects is what makes the numbers reliable.
So what are the key things you need to watch for? Some of those key variables when you're doing roll-up type models.
When I'm working on portfolio roll-up models for solar, so I currently work for NRG and also the Access, that is quite niche as of now. So first thing I look closely for, like commercial variables, and that is like tariff, contractors, escalations, because those small changes here can materially impact the portfolio returns. And from the project model perspective, getting these assumptions consistent across the project is critical. So first is the commercial variables. Secondly, I think I focus on the technical and operating assumptions like capacity, degradation, availability, and operating cost. These feed directly into the generation and cash flow stability. So I make sure they are realistic and aligned across the assets. And the last one is like financial variables, which are like quite interesting when it comes to funding and leave rate, cost of debt in our DSCRs, these refinancing assumptions. So when rolling projects up, I pay attention to how individual project structure is aggregated at the portfolio level.
Makes sense.
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