Background

A homeowner in Solarville is considering installing a photovoltaic (PV) system on their property. They have approached SunFinTech for financing options. As a finance intern, you've been tasked with creating a financial model to assess the viability of this project and determine the best financing structure.

Project Details

• System Size: 6 kW
• Total Installation Cost: €18,000
• Expected Annual Energy Production: 8,000 kWh
• Current Electricity Rate: €0.35/kWh
• Annual Electricity Rate Increase: 3%
• System Degradation Rate: 0.5% per year
• Project Lifetime: 25 years

Available Financing Options

1. Cloover Loan:
   • Term & Interest Rate: Make Necessary Assumptions
   • No down payment required

Subsidies

• 30% of the system cost

Tasks

1. Cash Flow Projection

Create projection for the financing option. Include:

• Initial investment
• Loan payments (for Cloover Loan option)
• Energy savings (consider annual electricity rate increase and system degradation)