Reference no: EM132909164

MBA643 Project Initiation, Planning and Execution - Kaplan Business School

Your Task

This assessment is made up of two parts:

» Part A students are asked to imagine they have been engaged by a Renewable Energy (utilities) company to develop a report on key aspects of project risk management and how they might be used in proposed future projects in order to manage and limit risk.

In Part A you are asked to write a report based on one of the below companies: Infigenergy
Tilt Renewables
The company you will analyse will depend on the LAST digit of your student number:

o 0 and 5 = Infigenergy
o 6 and 9 = Tilt Renewables

» In Part B you are asked to conduct a capital budgeting analysis for the second company Tilt Renewables. Answer the short answer questions.

Assessment Description

PART A
The report should begin with a short executive summary and conclude with several, short general recommendations. The content you include in the report should link the project management principles detailed below with the practices of the renewable energy company you have been allocated.
The topics on which students need to make recommendations in their report include:
i) Project selection - How should the company you select determine what projects to undertake and what ones to avoid? What tools, measures, and practices are available to project analysts in this industry?
ii) Cost management - What is the role of project cost management for your chosen company? Why is it important? What strategies or approaches should the company you have chosen adopt in order to effectively manage project costs?
iii) Funding - What funding measures or options are generally available to assist companies like the one you have chosen to fund proposed new projects? The report should include reference to any implications associated with different funding types or models.
iv) Implementation and winding up - Are there any particular issues associated with commencing a project that your company must consider? Why are they important? Who do they impact or affect? What happens when the project finishes? How are projects wound up? Do they just end or are there resource or infrastructure considerations? Are there environmental issues associated with the end of a project?

PART B
Consider the following three sources and answer the following questions directly. You do not need to write a lot for each question and for some you will need to use excel calculations. Submit you excel spreadsheet together with your report in the separate submission inbox on the assessment table.

Source 1: Tilt Renewables Snowtown North Solar Energy Farm
Source 2: Tilt Renewables (TLT.NZ) Yahoo Finance
Source 3: Tilt Renewables Financials

You have been employed as a project manager by Tilt Renewables and asked to evaluate a solar farm project at Snowtown run by Tilt Energy (See Source 1).

You have been asked to evaluate whether Tilt Renewables should undertake the Snowtown North Solar Energy Farm based on the above sources. Assume this project has not yet been approved.
» Assume this is a twenty-five-year project.
» Consult source 1 for the estimated initial outlay/investment today (year 0)
» The investment will be depreciated on a straight-line basis over twenty five years to 0 book value. It is estimated that the solar farm can be sold at the end of year 25 for $10 million.
» The solar farm will sell $10,000,000 worth of electricity each year into the grid from year 1-25
» Operating expenses for 25 years are $5 per solar panel per year (see number of solar panels from Source 1)
» The tax rate is 30%. All cash flows are annual and are received at the end of the year. The discount rate is 10%.

a) Based on the above information calculate the FCFs of the project.
b) Calculate the NPV for the solar farm. Should Tilt Renewables undertake this project?
c) Does the NPV take into account the CO2 emission reductions that the project will lead to (See Source 1)? Should it take this into account? Why or why not?
d) What is the debt to equity ratio in 2019 of Tilt Renewables according to source 3? How does this compare to other utility companies? What is the current share price according to Source 2 and when were shares first issued?

Attachment:- Project Initiation and Planning and Execution.rar