Source code for oemof.tools.economics

# -*- coding: utf-8 -*-

"""Module to collect useful functions for economic calculation.

This file is part of project oemof (github.com/oemof/oemof). It's copyrighted
by the contributors recorded in the version control history of the file,
available from its original location oemof/oemof/tools/economics.py

SPDX-License-Identifier: GPL-3.0-or-later
"""


[docs]def annuity(capex, n, wacc, u=None, cost_decrease=0): """Calculates the annuity of an initial investment 'capex', considering the cost of capital 'wacc' during a project horizon 'n' In case of a single initial investment, the employed formula reads: .. math:: annuity = capex \cdot \frac{(wacc \cdot (1+wacc)^n)} {((1 + wacc)^n - 1)} In case of repeated investments (due to replacements) at fixed intervals 'u', the formula yields: .. math:: annuity = capex \cdot \frac{(wacc \cdot (1+wacc)^n)} {((1 + wacc)^n - 1)} \cdot \left( \frac{1 - \left( \frac{(1-cost\_decrease)} {(1+wacc)} \right)^n} {1 - \left( \frac{(1-cost\_decrease)}{(1+wacc)} \right)^u} \right) Parameters ---------- capex : float Capital expenditure for first investment. Net Present Value (NPV) or Net Present Cost (NPC) of investment n : int Horizon of the analysis, or number of years the annuity wants to be obtained for (n>=1) wacc : float Weighted average cost of capital (0<wacc<1) u : int Lifetime of the investigated investment. Might be smaller than the analysis horizon, 'n', meaning it will have to be replaced. Takes value 'n' if not specified otherwise (u>=1) cost_decrease : float Annual rate of cost decrease (due to, e.g., price experience curve). This only influences the result for investments corresponding to replacements, whenever u<n. Takes value 0, if not specified otherwise (0<cost_decrease<1) Returns ------- float annuity """ if u is None: u = n if ((n < 1) or (wacc < 0 or wacc > 1) or (u < 1) or (cost_decrease < 0 or cost_decrease > 1)): raise ValueError("Input arguments for 'annuity' out of bounds!") return ( capex * (wacc*(1+wacc)**n) / ((1 + wacc)**n - 1) * ((1 - ((1-cost_decrease)/(1+wacc))**n) / (1 - ((1-cost_decrease)/(1+wacc))**u)))