Minimum DSCR |  |  |  |

The minimum DSCR is the minimum debt-service coverage ratio that Solar Advisor calculates for projects with Utility and IPP or Commercial - Third-Party Ownership financing as defined in the Technology and Market window.

The debt-service coverage ratio in each year n is the ratio of operating income to expenses in that year:

Where,

DSCR n | Debt service coverage ratio in year n shown in the PreTax Debt Service Coverage Ratio row of the cash flow.
R n ($) | The required revenue in year n, shown in the Revenues row of the cash flow. The revenue in year 1 (R n=1) is equal to the first year PPA price. The revenue is subsequent years (R 1<n≤N) is equal to the first year PPA price adjusted by the PPA escalation rate defined on the Financing page.
C Operating,n ($) | The total operating costs in year n, shown in the Operating Costs row of the cash flow.
C Interest,n ($) | The loan interest payment in year n, shown in the Debt Interest Payment row of the cash flow.
C Principal,n ($) | The loan principal payment in year n, shown in the Debt Repayment row of the cash flow.

In Solar Advisor, the project's debt service coverage ratio (reported in results as the Minimum DSCR) is the lowest value of the DSCR that occurs in the life of the project N, equivalent to the Analysis Period on the Financing page.

Where,

minimum DSCR | The minimum debt service coverage ratio, reported as a result in the Metrics table.
DSCR n | Debt service coverage ratio in year n shown in the PreTax Debt Service Coverage Ratio row of the cash flow. (The symbol min represents the function that searches for the minimum value of the DSCR in the cash flow.)

Solar Advisor calculates the minimum debt-service coverage ratio to be greater than or equal to the minimum required DSCR target defined on the Financing page. The iterative algorithm used for the calculation is described in 1st Year PPA Price.