Renewable Energy Project Finance Modeling

Final project for INAF U6326 — Renewable Energy Project Finance Modeling at Columbia SIPA, Spring 2025. A full-cycle financial model for a wind farm, built from the lender's seat: construction loan through conversion to term loan, debt sculpting, tax-equity flip, P-case stress tests, and a term-sheet draft for the EPC agreement.

What the model covers

• Twenty-five years of operating cash flows driven by a PPA, layered onto a 60/40 debt-equity stack
• Tax equity via PTC and ITC structures, modeled side-by-side so the sponsor sees the trade-off in IRR, leverage capacity, and flip timing
• Debt sculpting to target a DSCR (rather than flat amortization) so principal payments move with the revenue curve
• P50 / P90 / P99 production scenarios plus sensitivities on PPA floor, resource year, and cost of replacement debt
• Term sheet for an EPC contract, summarized to four pages so a decision-maker who hasn't read the underlying agreement can still see the commercial essence

What it taught

Half the course was the model; the other half was reading real credit agreements and pulling the commercial story out of the legal language. You quickly learn that project finance is a business of sentences — who is the lender, who is the sponsor, who absorbs first loss, what happens in a bad resource year — and the spreadsheet is just a consistent way to price the sentence.

The third week I tightened the PPA floor and watched the coverage ratio drift 0.04× south every pass. No amount of tax-equity structuring was going to out-argue a bad resource year. That was the lesson, and the whole point.