User guide for financial model investment analysis for buses

Transcription

1 User guide for financial model investment analysis for es This publication has been produced with the assistance of the European Union ( The content of this publication is the sole responsibility of Baltic Biogas Bus and can in no way be taken to reflect the views of the European Union.

2 The Baltic Biogas Bus project will prepare for and increase the use of the eco-fuel Biogas in public transport in order to reduce environmental impact from traffic and make the Baltic region a better place to live, work and invest in. The Baltic Biogas Bus project is supported by the EU, is part of the Baltic Sea Region programme and includes cities, counties and companies within the Baltic region. Author: Emilie Lindblad Olsson, Pwc, Sweden Project Manager: Lennart Hallgren, Stockholm Public Transport Date: Reviewed by: Nils Hedvall and Sara Anderson, Stockholm Public Transport 2

3 TABLE OF CONTENTS Purpose of the model... 4 Description of the model... 4 Model scope... 4 Model structure... 5 Definitions of model terms... 7 User instructions... 8 Input sheet... 8 Analysis sheet... 9 Calculations sheets Cost parameter sheets Tax & personnel Other common costs Public economic costs

4 Purpose of the model The purpose of the model is to illustrate the cost difference for investments in, and use of es powered by different fuels. The use of the model is in the context of comparing alternatives when procuring traffic, especially comparing alternatives of es with different fuel sources. Description of the model Model scope The model comparison between different investment alternatives comprises only costs. Revenues are assumed to be indifferent to type of fuel as well as type. Therefore, revenues are not considered relevant in a comparison. The cost for each alternative consists of: Depreciation and interest regarding initial investment in Annual cost regarding other identified iness related costs Public economic cost based on assumed green house gas emissions and particle emissions from es. Further, the model is based on two types of assumptions: General assumptions regarding the identified costs, which do not necessarily differ between different alternatives or situations. Examples of general assumptions are inflation, interest rate and specific growth rates for different cost categories which may be used instead of inflation in the forecast. Specific assumptions per evaluated alternative. These are: o Bus type o Fuel type o Number of es o Investment cost & lifetime of investment o Vehicle km/year and vehicle hours/year General and specific assumptions are combined for different evaluated alternatives to calculate the iness related costs and the public economic costs for each alternative. A total cost per alternative is also shown. The model presents both accumulated costs and discounted costs per chosen alternative. The costs are calculated through a time period of up to 25 years, covering the entire technical life period of the es. In the case that the lifetime is different for the alternatives, a residual value is included in the alternatives where the has a longer lifetime. In the model, 9 different investment alternatives can be compared at the same time. 4

5 The model uses predefined currency (SEK) and units (e.g. consumption of fuel per litre or per Nm3) according to the labels on each separate sheet. If the user wishes to use another currency than SEK and consumption in another unit than the ones in the model, a consistency check of that the same currency and/or unit is used throughout the model must be performed. Model structure The model comprises 38 sheets which can be divided in to four different categories; Input sheet (sheet 1, dark green) Analysis sheet (sheet 2, dark green) Calculations sheets (sheets 3-11, light green) Cost parameter sheets (sheets 12-38, cost categories are dark blue, sheets with data are light blue) The purpose of the different sheet categories are the following: Input sheet: The sheet in which the user inputs general and specific assumptions about all alternatives that they wish to evaluate. These assumptions should be updated each time an analysis is performed. Analysis sheet: Shows the outcome of the comparison for the chosen number of alternatives. This sheet should never be altered by the user. Calculation sheets: Use the given assumptions from the Input sheet as well as basic data from the Cost parameter sheets to perform the calculations for each chosen alternative. A maximum of 9 alternatives can be compared at the same time, each having one calculation sheet. These sheets should never be altered by the user. Cost parameter sheets: Contain general assumptions and verified data regarding costs for different fuel and types. This data should be input by the user the first time the model is used, and should then be updated when market conditions change. There should be no need to change the data each time an analysis is performed, as the data concerns a region s or country s underlying market conditions. Also, verified cost data from different sources, i.e. company specific supplier contracts can be used here. It is recommended to verify the relevance of the data periodically, i.e. once a year. 5

6 Model input Bus type Fuel type No of es Investment cost (SEK) Lifetime of Vehicle investment km/yr Vehicle h Motor class Alternative 1 Bogie - Euro 2 Alternative 2 - Euro 1 Alternative 3 Normal - Euro Cost parameter sheets with cost assumptions Taxes Service Fuel OH Calculation sheets Alt 1 Alt 2 Alt 3 Alt 4 Alt 5 Alt 6 Alt 7 Alt 8 Alt 9 Model output: Comparison between different alternatives chosen SEK Alt 1 Alt 2 Alt 3 Alt 4 Cost comparison Aggregated cost Business cost Residual value Public economic cost Total aggregated cost Figure 1 The structure of the model is demonstrated above. 6

7 Definitions of model terms Term Business cost Public economic cost Residual value Definition Costs that relate to the operations concerning the es such as; -depreciation of es -fuel costs -service and maintenance -personell -taxes -insurance -overhead costs Costs (direct and indirect) that relate to environmental effects such as emissions of greenhouse gases and particles. When performning an analysis between different alterantives the model will calculate the costs during the time period that matches the lifetime of any of the compared alternatives which is the shortest. Since the technical lifetime and the economic lifetime of each is assumed to be equal, es which have a longer lifetime will have a remaining value over their remaining life period. This remaining value will be accounted for in the comparison as a residual value of the added to the cost calculation, thus lowering the total costs of the alternative with a longer lifetime. CO2 NOx PM HC CO Carbon dioxide Nitrogenoxides Particulate matter Hydrocarbon Carbon monoxide 7

8 User instructions Input sheet When performing an analysis all necessary data should be input in the sheet named Input, Figure 2. The user may enter information about nine different alternatives, cells B4:J12. In the blue cells, drop-down lists are available and in the light green cells the user should type the information. The dark green cells are linked to the inflation cell, but can be overwritten with other data if inflation is not wished to be used for the specific cost. Note that investment cost, lifetime of investment, vehicle km/yr and vehicle h are per vehicle. In cells C15:C17 general assumptions such as inflation, interest and discount rate are entered. The yearly inflation rate is entered in cell C15. This is the number that the dark green cells C20:C25 uses, since these are costs that normally can be expected to grow at the pace of inflation. In the Calculation sheets, the costs for year 1 are linked in from the cost parameter sheets and are growing at the pace of inflation year 2 and onwards. Staff costs, however, usually grow at a slightly higher pace than inflation, which should be entered in cell C26. If the user wishes to use different growth paces for the cost categories, this can be entered directly in to the dark green cells, replacing the link to the inflation cell. In the same way, the staff costs may be linked to the inflation cell if the user wishes to use inflation. If all dark green cells are overwritten by numbers, the inflation cell serves no purpose. The interest rate, entered in cell C16, is used to calculate the cost of capital for the investment in es. The calculation sheet uses the investment cost and the lifetime of the investment to calculate the average invested capital for each year, which is the basis of the capital cost (rows in each calculation sheet). To find the capital cost, the investment is multiplied by the entered interest rate. The interest rate entered by the user should therefore reflect the rate that is paid for the capital used to finance the es. The discount rate entered in cell C17 is used in the calculation of the discounted iness cost, residual value and public economic costs for each alternative, shown in rows in the Analysis sheet. 8

9 Chosen alternatives Bus type Fuel type No of es Investment cost (SEK) Lifetime of Vehicle investment km/yr Vehicle h Motor class Alternative 1 Bogie - Euro 2 Alternative 2 - Euro 1 Alternative 3 Normal - Euro 5 Alternative 4 - Euro 3 Alternative 5 Normal - Euro 4 Alternative 6 Alternative 7 Alternative 8 Alternative 9 General assumptions Inflation - Interest - Discont rate - Per Yearly growth of costs Rent cost refuelling plant Availability & work shop Service of es Towing service Wear and tear Fuel price Staff cost - Inflation - Inflation - Inflation - Inflation - Inflation - Inflation - Specific Figure 2 The figure illustrates the input sheet where information about the es, inflation and yearly growth which differs from inflation is entered. Analysis sheet In the sheet Analysis the user views the output of the comparison between the types that have been entered in the Input sheet. The output is only shown for the number of alternatives used in the comparison. When a type is chosen for an alternative in the Input sheet (cells C4:12), the alternative becomes visible in the Analysis sheet. The output is presented as aggregated cost and discounted cost as seen in Figure 3. Aggregated iness costs, row 12, include depreciation of the es, cost of capital, fuel, service and tax costs etcetera. Aggregated residual value, row 13, contains values if the types have a closing book value after the analysis period. For example, when comparing es with different life time, the with the longer life time will get the effect from its residual value added to the calculated costs and thus accounted for in the comparison. The model will always compare the alternatives over the time period corresponding to the lifetime of the alternative with the shortest lifetime. Aggregated public economic costs, row 14, take into account emissions of CO2, NOx, PM, HC and CO. 9

10 The aggregated costs are calculated through an addition of the yearly costs calculated for each alternative in the Calculations sheets (Alt 1, Alt 2, Alt 3... to Alt 9). In the rows 19 to 21 the values have been discounted to today s value of money using the discount rate entered in the sheet Input, cell C17. SEK Alt 1 Alt 2 Alt 3 Alt 4 Alt 5 Chosen data for comparison Bus type Bogie Normal Normal Fuel Diesel Diesel Biogas Biogas Ethanol No of Buses Lifetime Cost comparison Aggregated cost Business cost Residual value Public economic cost Total aggregated cost Discounted cost Business cost Residual value Public economic cost Total discounted cost Figure 3 Illustration of the output calculated by the model. Calculations sheets In the calculation sheets, the calculations performed for each alternative may be viewed by the user. In the upper left corner, the user may alternate between view 1 and view 2 by pressing the corresponding button. In view 1, an overview of the costs per year for each cost type is shown, as well as a summary of the calculation of aggregated costs as well as discounted costs. In view 2, all calculations performed by the sheet is shown. View 1 is probably more useful, if needed at all (since the results are given in the Analysis sheet). It is recommended not to use these sheets, since the model functionality depends on that they are not amended. Figure 4 below illustrates how a calculation sheet looks like in view 1. 10

11 Alternative 1 Rött = måste uppdateras per alternativ SEK Year 1 Year 2 Year 3 Business costs Depreciation Cost of capital Direct fuel costs Indirect fuel costs Availability & work shop Service Towing service Motor-vehicle tax Staff cost Third party liability insurance Wear and tear Sub-total iness costs Allocated overhead costs Business costs Public economic costs CO NOx PM HC CO Public economic costs Total costs Values not regarding minimi year Values regarding minimi year Aggregated costs Costs during mininmi year Residual Value Business costs Public economic costs Total Discounted costs Costs during minimi year Residual Value Business costs Public economic costs Total Total Total Figure 4: The figure illustrates part of the view 1 in the Calculation sheet for alternative 1. 11

12 Cost parameter sheets As the iness environment changes, or as new data is available, the basic assumptions for the cost parameters for each and/or fuel type should be updated. The Cost parameter sheets are found to the right in the model. Each cost type is indicated by a dark blue sheet, and the information bases for the calculations are found in light blue sheets. If changing a cost parameter, this change applies to the entire model. The changes should only be made in the green cells in each sheet. Direct fuel cost- cost of fuel The section direct fuel cost contains two sheets: Fuel price and Consumption per km. In the sheet concerning Fuel price the user enters the price per litre (for ethanol and diesel) or Nm3 (for biogas). Today s price is entered in cells C4:C6. In cell C8, the expected growth factor for fuel prices is shown, linked from the Input sheet. If needed to be amended, it should be changed in the Input sheet. Since the maximum number of years that can be used in the analysis is 25, a forecast of fuel prices for a time period of 25 years is used. Fuel price - forecast per fuel type Unit SEK/litre or Nm3 Year 1 Year 2 Year 3 Year 4 SEK/Nm3 - SEK/litre - SEK/litre - Yearly growth of fuel price - Figure 4 The fuel price is entered for year 1. The user enters consumption of fuel per km in the sheet Consumption per km. Consumption is entered in the cells C4:E6 depending on type of and type of fuel. The information is entered in litre (for ethanol and diesel) or Nm3 (for biogas). Consumption of fuel per km Unit litre or Nm3 Normal Bogie Nm3 litre litre Figure 5 Depending on type of and type of fuel, consumption is entered as illustrated above. Indirect fuel cost- infrastructure for refuelling The next section contains indirect fuel costs in the three sheets Refuelling plant, Electricity to plant and Maintenance of plant. 12

13 In the sheet Refuelling plant the user enters information of yearly cost of refuelling plants. The data is entered in cells C4:E6. The data should be entered as cost per and refuelling plant depending on what type of and what fuels that is concerned. It will reflect either each part of yearly rent, or each part of yearly capital cost of investment. Yearly cost for refuelling plant (per ) SEK Normal Bogie Figure 6 The yearly cost for refuelling plant is entered depending on type of and type of fuel. In the sheet Electricity to plant the user enters information about how many percent of fuel cost that is expected to correspond to the cost of electricity. The data is entered as a percentage in cells C4:E6. If the electricity is included in the rent of the plant the entered percentage should be 0%. Percentage of the total cost of fuel that is assumed to correspond to electricity cost % Normal Bogie Volume of electricity as basis for calculating electricity cost - relating to actual fuel price per year Figure 7 The cost of electricity depends on the fuel cost. In the sheet Electricity to plant the user enters how many percent of fuel costs that corresponds to the cost of electricity. The user enters the maintenance cost for refuelling plants per in the sheet Maintenance. The data is entered in cells C4:E6 in SEK per type of and type of fuel. If this cost is covered by paid rent for the refuelling plant, a zero should be entered, or the cell left blank. Maintenance cost of refuelling plant SEK Normal Bogie Figure 8 Depending on different fuel types es need specific service that is entered as illustrated above. Towing costs are calculated with information of number of es towed and cost for towing. In the sheet Towing number the user enters information about how 13

14 many time per year es are in need of being towed. Data is entered as the average towing per and year in the cells C4:E6. The cost for towing is entered by the user in the sheet Towing cost in SEK per each time in the cells C4:E6. Towing - number per Towing per Normal Bogie Towing - cost per each time SEK per & year Normal Bogie Figure 9 Towing costs depend on the number of es and cost per each time. The information is entered into the two matrixes as illustrated above. Tax & personnel The section tax consists of the sheets Motor vehicle tax and Staff costs. In the sheet Motor vehicle tax the user enters data of motor vehicle tax paid in SEK per and year, depending on type and type of fuel used. The information is entered in the cells C4:E6. Motor vehicle tax SEK per year & Normal Bogie Figure 10 Illustration of how motor vehicle tax is entered into the model in SEK per year and. The user enters information about the hourly rate per driver hour and washing hour in the sheet Staff costs. Data should be entered in SEK per hour in the cells C4:E6. The cost is calculated using vehicle hours, entered in the Input sheet column I, as a base for the calculations. Since the vehicle hours only show hours on timetable they might need to be increased with other time that the staff works, for example the time during which the is washed. In the cell C8 the user specifies in percentage how much the vehicle hours should be increased due to other driver time. 14

15 Hourly rate per driver hour and washing hour SEK per h Normal Bogie Increase other driver time - Figure 11 In the sheet Staff costs the user enters information about hourly rate per driver and washing hour. Other common costs This section contains the three sheets Third party liability insurance, Wear and tear and OH. In the sheet Third party liability insurance the user enters the cost in SEK per and year for insurance in the cells C4:E6. Third party liability insurance per SEK per & year Normal Bogie Figure 12 Insurance cost in SEK per and year is entered in the sheet Third party liability. The cost for wear and tear of tiers and exhaust systems is entered in the sheet Wear and tear. The user should enter the information in SEK per and year in the cells C4:E6. Wear and tear costs per SEK per & year Normal Bogie Figure 13 Above, the matrix for input data concerning wear and tear of tire and exhaust system is illustrated. The last sheet in this section is OH. In this sheet the user enters how large the overhead costs are. The data is entered in the cells C4:E6, as a percentage of iness costs covered in all sections above. 15

16 % allocated overhead costs % Normal Bogie Figure 14 The user enters how large overhead costs are as a percentage of iness costs. Public economic costs The sixth and final section is public economic costs and consists of the six sheets HC, CO, CO2, NOx, PM, and Emission values. In the sheet HC the user enters the emission of hydrocarbons (HC) in kg per km in the cells C4:E6. HC kg/km Normal Bogie Figure 15 Emission of hydrocarbons is entered as kg/km as illustrated above. In the sheet CO the user enters information about the emission of carbon monoxide (CO) in kg per km in the cells C4:E6. CO kg/km Normal Bogie Figure 16 Emission of carbon monoxide is entered as kg/km as illustrated above. In the third sheet CO2 the user enters the carbon dioxide emissions (CO2) in kg per litre. Please note that this is the only emission not entered in kg per kilometre. The calculation uses the consumption in litres per km from the sheet Consumption per km under the heading Direct fuel costs. If other units than the ones stated in that sheet are used, a consistency check needs to be performed in order to establish that the emission calculation is still correct. Biogas is CO2 neutral, therefore no values in CO2 per Nm3 is needed; the value for biogas should always be zero. The data for ethanol and diesel is entered in the cells C5:E6. 16

17 CO2 kg/l Normal Bogie Figure 17 Emission of carbon dioxide is entered as kg/l for es that use ethanol or diesel fuel as illustrated above. The user enters data about the emissions of nitrogen oxides (NOx) in the sheet NOx. All es emit NOx and the emissions depend on the motor class (Euro 1-5). There is also a difference due to fuel and for es that use diesel as fuel, the type of also affect how large the emissions are. The user enters data in kg per km in the cells C4:G8. NOx kg/km Euro 1 Euro 2 Euro 3 Euro 4 Euro Normal Diesel Bogie Diesel Diesel Figure 18 Emission of nitrogen oxides is entered as kg/km as illustrated above. The emissions differ depending on motor class (Euro 1-5) and type of fuel. For es that uses diesel, the type of is also a parameter that effect emissions. In the sheet PM the user enters data about emissions of particulate matter (PM) in kg per km. As for emissions of NOx, PM depends on motor class, fuel and for diesel what type of that is used. The information is entered in the cells C4:G8. PM kg/km Euro 1 Euro 2 Euro 3 Euro 4 Euro Normal Diesel Bogie Diesel Diesel Figure 19 Emission of particulate matter is entered as kg/km as illustrated above. The emissions differ depending on motor class (Euro 1-5) and type of fuel. For es that uses diesel, the type of is also a parameter that effect emissions. Finally the user enters data of the cost for emissions. The costs are entered in SEK per kg for each emission in the cells C4:C8. 17

18 Emission values SEK/kg CO2 - Nox - PM - CO - HC - Figure 20 In the sheet Emission values the user enters the costs for each type of emission as illustrated above. 18