[Sawinee Sawanont]

From your experience, what do you think is the most critical factor when performing Financial Due Diligence on solar projects?

In my view, the Power Purchase Agreement (PPA) is key because it drives revenue stability. I also noticed that assumptions like irradiation levels and capacity factors can significantly impact projections.

Another area I find important is reviewing operating costs and future capex, since even small changes can affect long-term returns.
Do you think financial assumptions or contract terms are more important in evaluating solar projects?

[Hossam Hassan]

I agree the PPA is the most important factor. If the contract is weak or the buyer of the electricity is not reliable, the whole project is at risk no matter how good the numbers look. I would also highlight curtailment risk – when the grid cannot absorb all the power produced, the project loses revenue in a way that is hard to predict or fix.

[Author]

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