SAVi Sustainable Asset Valuation
Sustainability Assessment of an Onshore Wind Portfolio in Germany - An Application of the Sustainable Asset Valuation (SAVi) for B Capital Partners.
B Capital Partners, a Swiss-based investment house focusing exclusively on investing in sustainable infrastructure, invited the International Institute for Sustainable Development (IISD) to conduct a sustainability assessment on one of their onshore wind portfolios.The portfolio is located in Germany and has a total capacity of 29 MW.
The objective of the assessment was to integrate a range of environmental, social, and economic costs and benefits into an asset valuation to improve the transparency of the asset’s impacts on the environment and important stakeholders. In addition, the assessment served to reveal the asset’s financial resilience toward climate change risks. IISD customized and applied the Sustainable Asset Valuation (SAVi) methodology to conduct a comparative sustainability assessment of the onshore wind portfolio and a hypothetical gas-fired power plant with the same power generation capacity.
The SAVi assessment valued the environmental, social, and economic costs and benefits (externalities) in financial terms and calculated the costs induced by climate change risks for both assets. Externalities and risks were incorporated into the following three components of the SAVi assessment:
- Cost-benefit analysis (CBA)
- Levelized cost of electricity (LCOE)
- Financial analysis, generating performance results for the equity and project internal rate of return (IRR).