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Financials glossary
Details about the Financials section of the GridLauncher

The energy generation tab

Primary generation, Battery storage and Backup generation

Listed are the most common systems available for microgrids. A system is usually designed with a primary generation component, sometimes a storage component and most often, a backup generation component.
Certain systems require a form of storage to ensure reliability of operations. For instance, a solar PV system requires battery storage for operations at night and during bad weather and/or peak load demand times of use. Similarly wind turbine requires battery storage to balance low wind and/or peak load demand times of use.
When selecting solar PV or wind turbine as primary generation, battery storage is automatically activated and the adequate amount is calculated. At the Development step of the GridLauncher, invited energy professionals are able to make the necessary adjustments.
Most common backup generation proposed: Diesel generator
Combined Heat and Power (CHP) is a technology that concurrently produces electricity or mechanical power and useful thermal energy (heating and/or cooling) from a single source of energy.

Estimated cost items

While setting realistic expectations at the project feasibility level, all costs and revenue are estimated.

Even though our software uses detailed consumption and production inputs, we assume potential use-cases to be at a +/- 30% accuracy margin off professional outputs.

Microgrids development requires energy experts to have the final say onto the most optimal energy generation and storage system and its sizing to properly service the electricity needs of the community.

Estimating the energy generation size

Consumers load profile

A common, basic concept related to electricity is the amount of kWh consumed for a period which is the amount of electricity a consumer needs to run their house, business, etc....
Another fundamental aspect is the peak load in kW which is the largest amount of power demanded by a consumer to turn on all of their appliances, devices, and sometimes machinery, at once.
To make it easy for all users, the GridLauncher proposes predefined categories of consumers (residential, commercial and industrial) enabling anchors to define who their consumers are and how many of them are to be included in the consumption profile of their community microgrid project. A mapping interface is included to help visualize these potential consumers.
The Duck Curve phenomena

Generation capacity

The technologies available in GridLauncher are of two types:
1) Dispatchable (can be turned on and off)
CHP/Cogen, turbines, engines and generators
2) Non-dispatchable
Solar PV and Wind turbine
Due to the nature of renewables such as solar PV and wind turbine, battery storage technology is required to ensure reliability of the microgrid operations.
To meet the electricity needs of the consumers at all time in the day and night, the energy generation capacity needs to be sized up and complex calculations need to be computed to handle normal operations as well as emergency situations.
Energy professionals run the microgrid profile through their own model to output the best ratio between generation capacity and cost, while providing the adequate technologies and combinations to ensure that the electricity generated meets the needs at all time.
In some cases, backup generation might be operated in support of the primary generation, optimizing cost and reliability. In other cases, it might be necessary to account for a cushion of generation capacity (10-20%+).

Why the GridLauncher in one sentence:

Setting realistic expectations for anchors on their microgrid projects, modeling revenue and cost to sell their electricity to their neighbors, attracting funding to their project, coordinating competitive quote requests with trusted energy professionals.

Categories of cost items

TOTAL COST (money to be raised to launch the project) (USD)

1) Engineering, Procurement and Construction (EPC) CAPEX (Capital Expenditures)
In simple terms, EPC is considered as the cost to purchase and install the energy generation and storage equipment, including the inverters.
For the sake of simplicity, GridLauncher assumes a loan financing term of 10 years for this category.
2) Ancillary equipment (services) CAPEX
All capital expenses NOT related to energy generation and storage equipment as defined above.
This category includes smart meters, transfer switches, remote breakers, site preparation, technical consultants and a microgrid control center.

OPEX (Operational expenditures, i.e. annual cost to operate the microgrid) (USD)

This category estimates all operational cost items annually.
Included items are DexGrid software, operation & maintenance (O&M), project insurance, standalone distribution lease, fuel cost per kWh.

TOTAL ANNUAL LOAN REPAYMENT (debt service) (USD)

This category covers the annual cost related to the financing of the Total Cost, including principal and interest. This annual cost goes to zero at the term of the loan.

AVERAGE ANNUAL PROJECT REVENUE (USD)

This item is calculated as retail rate (Tariff) per kWh * total annual consumption (kWh).

ITC DISCOUNT, IF AVAILABLE (USD)

The solar Investment Tax Credit is a federal tax credit for those who purchase solar energy systems for residential, commercial or utility scale properties. The credit, only available to state-based equipment ownership, is applied to the owner's federal income tax return debt and is equal to a percentage of the cost of eligible equipment.
The ITC discount is at 22% for 2023 and 10% for 2024.

REC REVENUE, IF AVAILABLE (USD)

This is an annual revenue available to producers of clean energy. The most common forms of renewables are solar and wind but also hydrogen and other forms of biogas fuels.