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TitleMethods for financial assessment of renewable energy projects: a review
Author(s)Delapedra-Silva, Vanderson
Ferreira, Paula Varandas
Cunha, Jorge
Kimura, Herbert
KeywordsDiscounted cash flow
Levelized cost of energy
Net present value
Real options
Return on investment
Issue dateFeb-2022
CitationDelapedra-Silva, V.; Ferreira, P.; Cunha, J.; Kimura, H. Methods for Financial Assessment of Renewable Energy Projects: A Review. Processes 2022, 10, 184.
Abstract(s)The financial evaluation of renewable energy sources (RES) projects is well explored in the literature, but many different methods have been followed by different authors. Then, it is important to understand if and how these methods have been changing and what factors may have driven new approaches. Therefore, this article aims to explore the publications on the financial evaluation of RES projects from 2011 to 2020 and to present a critical analysis of the reviewed literature. The methods for evaluating RES projects were grouped into four categories: (i) traditional metrics based on net present value, internal rate of return, and payback period; (ii) levelized cost of electricity; (iii) return on investment approach; and (iv) real options analysis. A quantitative analysis was carried out considering aspects related to the relevance of the authors, productivity by country, and the most relevant journals for each of these groups. Then, a qualitative analysis of the main characteristics of the five most cited articles in each group was conducted. The results show that the more traditional methods are still widely used for the financial evaluation of RES projects. However, approaches based on the levelized cost and real options have been growing in importance to tackle the complex features of financial evaluation and comparison of RES projects.
Publisher version
AccessOpen access
Appears in Collections:CAlg - Artigos em revistas internacionais / Papers in international journals

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