College - Author 1
College of Agriculture, Food and Environmental Sciences
Department - Author 1
Agribusiness Department
Degree Name - Author 1
BS in Agricultural Business
Date
3-2011
Primary Advisor
Erik Slayter, College of Agricultural, Food, and Environmental Sciences, Agribusiness Department
Abstract/Summary
This study was undertaken to determine if it would be cost-beneficial over a 30-year period to install solar panels to power the water pumps on the Schnoor almond ranch. A cost-benefit analysis was performed to determine if the investment would be financially worthwhile. The analysis included calculating the net present values of the annual cash flows along with the calculation of the internal rate of return. If the net present value proves greater than zero and the internal rate of return proves greater than the discount rate, the investment will be cost-beneficial. State and federal rebates and incentives were also analyzed and factored into the annual cash flows as positive amounts, helping offset the initial cost of the solar panels. Over a 30-year period, the financial benefits of installing solar panels on the almond ranch proved to outweigh the financial costs. This conclusion is based on the cost-benefit analysis that provides a net present value of over $360,000, an internal rate of return of 11.9%, as well as an investment resulting in positive cash flows after 11 years.
URL: https://digitalcommons.calpoly.edu/agbsp/59