Mixing Business with Biofuels

Sark7While it is accepted wisdom that the world needs to increase its focus on sustainable energy, there is still much dispute about whether initiatives of this kind are financially viable.

Sark7 is a specialist consultancy that aims to bridge the gap between populist enthusiasm surrounding ‘green’ initiatives and the intensive financial risk analysis demanded by capital investors and participants. It uses Palisade’s DecisionTools Suite to develop profitable business cases for sustainable energy projects. In effect, these act as due-diligence tools for prospective sustainability entrepreneurs, investors, project managers, providers and organisations.

Taking a biofuel plant as an example (but stressing that the techniques used are equally applicable to sustainable energy initiatives such as wind or solar energy), Sark7 uses various components of Palisade’s DecisionTools Suite to demonstrate viability. @RISK models the biofuel project’s Net Present Value (NPV), PrecisionTree informs strategic scenario decision-making and Evolver suggests plant optimisation strategies.

The premise is simple: Sark7 believes that environmental experts and enthusiasts need to be realistic about whether their proposal is financially viable if they are going to attract the funds that will make it a reality. Palisade’s risk analysis tools provide the language that is familiar to the financial world, as a result of which the project is more likely to receive funding. Sustainability criteria can therefore be met at the same time as providing investors with a risk-balanced return – so everyone wins.

» Read the full case study

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