Flat Plate PV Commercial Cash Flow Computation Error?

After tax cash flow is not correctly computing. Very easy to see in years 19-20 for instance where energy value is 25k, operating expense -4k, p&i payment -13k, tax savings 2k, should sum around 10k of after tax cash flow. Instead, value is at 346 dollars. Attached the sam file for easy review.

Hello,

I'm not sure there is an error in SAM's cash flow calculation.

The "energy value" is the revenue from electricity sales, which SAM treats as taxable. So the net after-tax energy value is not $25K, but $25K * (1-0.3869) = $15K, where 0.3869 is the effective tax rate.

Did you try "Send to Excel with equations?" (It's only available in Windows, so nevermind if you're using a Mac.) You can use that for the utility IPP, commercial and residential financing options to trace through the financial model calculations.

Here are the details of how SAM calculated the $346 after-tax cash flow for year 20 in your file. First, here's the general equation:

After Tax Cash Flow = Energy Value * (1 - Effective Tax Rate)
                            - Operating Costs
                            - Total Debt Payment
                            + Total PBI
                            + State Tax Savings
                            + Federal Tax Savings

Now, with values from your file for Year 20:

After Tax Cash Flow = $25,224 * (1 - 0.3869)
                            - $3,771
                            - $13,071
                            + 0 [no PBI]
                            + $316
                            + $1406
                            = $345 [slight difference due to rounding]

Best regards,
Paul.

Paul,

Thanks for the reply, the effective tax rate hadn't occurred to me but I see that it does make sense as with lower operating costs, tax liability will increase.

I do work in windows 8, and tried the new Send to Excel with Equations function; however, it gives me the following error:

Failed- Cannot obtain CLSID from ProgID

I only have Excel 2010 Starter edition installed as I primarily work with Open Office applications which I suspect is the problem. Copying to clipboard and pasting into openoffice calc allows me to reformat the numbers, and gets the job done, but would be excellent to have the equations in the worksheet to quickly be able to understand how the calculation is being done.

Thanks for your work on this software, it is excellent.

Cheers
bg

Hi,

There is probably something about the starter edition of Excel that is preventing SAM from opening it. We will look into this and see if we can provide a solution in the next version of SAM (Summer/Fall 2013).

In the meantime, you can find the Excel files that SAM uses for the Send to Excel with Equations feature in your SAM installation folder. By default in Windows, the files are in C:\SAM\2013.1.15\exelib\spreadsheets\equations. That's not as nice as having the file populated with your inputs, but should help you understand the financial model calculations.

Best regards,
Paul.