NatLabRockies / NatLabRockies/SAM

Feature Request: Multiple Construction Years and/or non-Year 0 Capital Expenditures

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financial new feature wishlist
Dominant language
C++
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Description

Is your feature request related to a problem? Please describe.

Yes - we have a problem with being able to accurately calculate NPVs/IRR in GEOPHIRES for geothermal projects.

Geothermal projects are typically expected to have multi-year permitting, exploration, and construction timelines. The GEOPHIRES SAM Economic Model is currently only able to support 1 construction year due to SAM's financial model allowing multiple construction/pre-revenue years and/or non-Year 0 capital expenditures.

Describe the solution you'd like

Support either or both of:

  1. Multiple pre-revenue years (before Year 0) that allow per-year allocations of capital expenditure
  2. Support capital expenditures after Year 0
Describe alternatives you've considered
  1. In some cases it is acceptable to calculate time-adjusted NPVs from SAM cash flow revenue/returns line items, such as royalty streams, but this is not adequate for the tax investor's NPV.
  2. Additional capex can be added to the installation cost passed to SAM (similar to the SAM UI's Construction Financing control), but this is also only a very rough approximation that is not appropriate for a proper cash flow analysis.
Additional context

Happy to discuss our use case in detail - please follow the links in my profile (@softwarengineerprogrammer) for contact info (or we can discuss on this issue, whatever works best for you).

Thanks for your help and consideration!

Contributor guide

Open the contributing guide

First steps

  1. Read the whole issue, then the project's contributing guide.
  2. Comment on the issue to say you are picking it up — it saves two people doing the same work.
  3. Fork the repository and make your change on a branch.
  4. Open a pull request that references the issue number.

Research direction

Read the linked SAM Economic Model documentation and issue 406, then trace how the current financial model represents its single construction year and capital expenditures. Done should support multiple pre-revenue years with per-year capital allocations, capital expenditures after Year 0, or both, with correct NPV and IRR calculations.

Written by the indexing model from the issue text.

Assessment

Tech stack
cpp
Domain
fintech-quant
Issue type
Feature
Difficulty
5/5
Estimated time
Over a week
Activity status
Stale
Clarity
Mostly clear
Newbie friendliness
35/100

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