
Business: Finance 199
Table 11.2 Risk and financial impact (Mendelsohn, 2011).
Risk Explanation Financial cost impact
Technology Risk Any operational experience? High
Developer Risk Experience with technology,
project size & type?
Balance sheet strength?
Medium – perceived risk
can lead to high reserve or
guarantee requirements
Revenue Certainty Is buyer credit-worthy?
Are prices firm?
Medium – high
Duration of
Revenue Support
Debt duration (tenor)
no longer than PPA
minus 2 years, shorter
based on risk perception
Very high
Cost Certainty Are components already
purchased? Or are they
subject to significant re-pricing?
Low
Currency Risk Are costs/revenues in desir ...