Financial analysis involves among inputs such as capital cost, electricity export rate, required rate of return, electricity export escalation rate, to encourage investment in renewable projects. Thai government offers several incentives such as income tax exemption and tariff rates for these projects.
Financial Analysis Sheet also requires project annual costs and credits. Fuel price escalation rate (such as in case of biomass power plants), and inflation rate. The RETscreen discount rate or required rate of return for this project and a value chosen for the providing a comparison with other indicators including the exception for income tax (for 8 years) and tax depreciation in the economic analysis of the solar PV projects [7].The pre-tax forms of the Weighted-Average Cost of Capital (WACC), which is useful for comparing with different markets. But the post-tax form, which is used in this study that the return rate to equity after paying the cooperated tax is set with the benchmark of minimum rates with 11.0%. In the final analysis no emission reduction credit or clean production income is assumed.
The WACC determines as the benchmark; it is based-on the assumptions of cost and debt and equity that helpful to determine the investment. The debt ratio of 0-90% is suggested for renewable energy projects by the RETscreen model. In this study a range of 50-54% debt ratio was employed in the financial analysis of the various projects. Other financial assumptions are shown in Table 2.