Model Walk Through Introduction to Battery Model

Overview

Introduction to our battery course financial model. A sample of our battery model walk through videos

 Video

Model Walk-Through: Introduction to Battery Model

 

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Video Transcript 

Welcome to the Battery Course Financial Model.

The purpose of these modeling videos is to put the concepts down into numbers, and we hope that this helps you see the practical implementation of the concepts that were introduced in the other videos. Now, as we work through these videos, you should also get a sense for the major moving parts of this model. Unlike many of our other courses, this is not a modeling course.

We will not be teaching how to code or write formulas in this course. The objective here is more to orientate you with a model and to set you up to run your own sensitivities and scenarios to evaluate battery storage investments. So the what’s included in this model?

This version of the model is a standalone storage model. This means that the battery is not charged by energization, solar, wind, or any other power-generating asset. The battery charges from the grid and discharges directly into the grid. The model forecasts cash flows for 10 years on an annual basis, meaning each column of the model represents one year.

There are four tabs in this model.

First, the red output sheet called the Dashboard sheet. This will include some key outputs from the model.

The Inputs sheet here in gray will include all of the assumptions required to complete the calculations. It also includes a scenario manager as well as an Output data table to show the outputs for the various scenarios that you’ll run.

The Calculation sheet is shown in blue. As the model is kept relatively simple, we haven’t separated our operational calculations onto different sheets. But the Calculation sheet includes all of the calculations required for energy, revenue, costs, and returns.

We also have a sheet called Convert in orange. This is an example sheet that we will discuss during one of the model walkthroughs. Note that this model does not include debt or tax calculations, as those are already covered in our Renewable Energy Project Finance Modeling course and they don’t change drastically for the purposes of batteries.

The current version also does not include a generating asset together with a storage asset. We will add an example of a battery plus generating asset some time later in 2022.

Although we are not modeling together in this class, we will change inputs to assess the impact on returns. For that reason, we recommend you have our videos open on one screen and your model open on the other and that will help you do the exercises together with us.

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