Project Development Model
NREL developed the Project Development Model to evaluate the risks and investment decisions required for successful renewable energy project development. The two-phase iterative model includes elements in project fundamentals and project development based off commercial project development practices supported by tools such as pro formas and checklists.
Project Fundamentals or BEPTC™
For help with the BEPTC phase of your project, check out the Renewable Energy Project Development Tool, developed by NREL for U.S. Department of Energy's Community Renewable Energy Deployment effort. The tool helps you quickly establish the key motivators and feasibility of your project.
Strong project fundamentals and an understanding of how a project fits within a portfolio of opportunities provide the team commitment and clarity needed to both secure the resources required to develop a renewable energy project and to persevere through the process. Properly establishing the following project fundamental elements will result in decisions to move the project forward or not. The five elements of project fundamentals are:
- Baseline: Analyze the current situation for the site, its energy supply, and identify specific objectives
- Economics: Analyze total costs of acquiring energy from existing sources and from proposed sources
- Policy: Examine federal, state, local, and regulatory policy environments for barriers; address barriers prior to expending significant resources
- Technology: Assess available renewable resources and the commercially available conversion technologies
- Consensus: Obtain agreement from staff and the financial resources to proceed.
Project Development or SROPTTC™
Once strong project fundamentals have been defined for a renewable energy project, the next step is project development. The seven elements to organize and evaluate the risks and investment decisions required in the project development phase include:
- Site: Identify the physical location for the physical assets of a project, including property rights, length of tenure, terms and conditions, etc.
- Resource: Characterize and understand the renewable resource being considered
- Off-take: Establish and secure by contract the buyer of both the energy and any other characteristics of output (e.g. renewable energy credits)
- Permits: Identify and obtain all permits necessary for project construction and operation
- Technology: Invest in engineering design, equipment selection, and procurement activities of the technology chosen in BEPTC activities
- Team: Assemble a fully qualified team that addresses all business, technical, financial, legal, and operational aspects
- Capital: Attract financial resources necessary for final development, construction, commissioning, and initial operations.
For more information on NREL's project development model, contact us.