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TSX Lithium explorer International Lithium Corp prepares to drill at Raleigh Lake Watch Now

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Inspirit Energy Share Chat (INSP)



Share Price: 0.0325Bid: 0.03Ask: 0.035Change: 0.00 (0.00%)No Movement on Inspirit Energy
Spread: 0.005Spread as %: 16.67%Open: 0.0325High: 0.00Low: 0.00Yesterday’s Close: 0.0325


Share Discussion for Inspirit Energy




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SharePicks
Posts: 153
Opinion:No Opinion
Price:0.045
RE: NPV & IRR for the 6.4kWe model
19 May '19
Thanks for that Observer.
Just going through the last RNS.
Where do you see this going?
Just looked additionally at the CLNs for INSP and it seems 0.07p is the very minimum for share price conversion.
 
observer842
Posts: 5,297
Opinion:Buy
Price:0.045
NPV & IRR for the 6.4kWe model
19 May '19
I've done some sensitivity studies with my old friend CROE.

C: Conservative Scenario
R: Realistic
O: Optimistic
E: Euphoric

Although these values can be altered, I've kept them all the same in the results presented below:

Discount rate: 8%
Gas Price: 2.25p per kWhr
Electricity Price: 12p per kWhr
kWe: 6.4
kWt: 15
Lifespan: 10 years
CapEx: £10,000 (sale price and installation)
OpEx: £100 (average maintenance costs per year)

These values are altered:

System efficiency: C:80%, R:85%, O:92%, E:95%
Utilisation per year: C:60%, R:70%, O:80%, E:90%

As an example of the cash flows per year consider the (R)ealistic scenario:

OpEx per year: (£100)
Cost of input gas: (£3,474)
Value of electricity generated: £4,709
Value of thermal generated (assuming 92% efficiency of a conventional boiler): £2,250
Total value (virtual cash flow) per year: £3,385

At an 8% discount rate the sum over 10 years for that cash flow is £22,716 (Using the PV formula in the spreadsheet)

To find the Net Present Value take away the initial Capital Expenditure of £10,000 resulting in £12,716.

For this case the Internal Rate of Return is simply the discount rate which results in an NPV of zero, in this case 31%.

For a CapEx of £10,000 the NPV of the other scenarios are:

C: £8,126
R: £12,716
O: £18,083
E: £22,552

and the IRR's are:

C: 23%
R: 31%
O: 40%
E: 47%

As a result of economies of scale the all in CapEx might be expected to half to around £5,000 in time. The NPV's in this scenario are simply £5,000 larger. Namely:

C: £13,126
R: £17,716
O: £23,083
E: £27,552

and the IRR's are:

C: 53%
R: 67%
O: 83%
E: 96%

Reminder: the utilisation percentages are for those that might be expected from a commercial setting, not a residential setting, and are high because the expectation is that the 15kWt generated is only part of the total thermal energy required, The Inspirit Charger being the lead (i.e. comes on first) boiler in the boiler room. Other conventional (read cheaper), boilers come on when the demand is greater than 15kWt.

DYOR - the above might contain miscalculations or incorrect assumptions.

I'm happy to vary other parameters if there is interest.

Sounds too good to be true doesn't it!? ;-)

Ob.




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