Establishes minimum financial viability. Per the thesis: no expert reported using formal frameworks by name, yet all relied on IRR and payback heuristics. This module makes that heuristic transparent and country-calibrated. Decision rule: proceed only if NPV > 0 and IRR exceeds your archetype's threshold (shown below).
Captures the value of staged commitment rather than a now-or-never decision. Per the thesis: "Investors who staged their commitments through conditional investment gates β proceeding to the next phase only after securing grid connection or subsidy allocations β were implicitly applying Real Options reasoning."
The strategic flexibility premium: total value = static NPV + option value. Higher volatility increases option value (asymmetric upside, downside protected by deferral).
Each gate is an explicit option to abandon, defer, or proceed. Status: Open = milestone not yet reached, Cleared = secured, Failed = blocker that triggers abandonment. The framework requires re-running ROA / MAUT / IGDT at every gate.
Site control via lease/option/purchase. Grid-adjacent or hybrid PV/wind injection point preferred (curtailment priority under LT rules).
TSO/DSO connection agreement signed. Per Tjurins: DSO fees disproportionately disadvantage smaller projects. Existing connection (hybrid) is a major accelerator.
Subsidy regime confirmed; BBCM participation rules clear; no retroactive tax exposure. Per CeleΕ‘ius: clarity matters more than favourability.
In-house trading team OR PPA / route-to-market partner. Per Krasauskiene: trading expertise is decisive in capturing ancillary revenue.
Option to Defer: Wait for cell prices to decline, regulation to stabilise, or competitor saturation to clear. Higher value with longer T and higher Ο.
Option to Expand: 2-hour pilot (10β50 MW) with embedded right to scale to full duration. Particularly valuable as longer-duration systems (Tavoras's 4h / 10h trajectory) emerge.
Option to Switch: Dynamically reallocate between FCR / aFRR / mFRR / arbitrage. As ancillary markets saturate (Enefit Narva trajectory), switching to arbitrage and curtailment-priority preserves value.
Translates conflicting objectives β IRR, grid reliability, environmental impact, regulatory exposure, technology maturity, and portfolio synergy β into a single composite utility. Weights are auto-calibrated to your archetype (Step 3 of the framework). Per the thesis: "The systematic weighting of IRR, regulatory risk, technical feasibility and market timing across multiple scenarios mirrors the multi-attribute trade-off logic that underpins MAUT."
| Attribute | Weight | % |
|---|---|---|
| 1. Financial Return (IRR / NPV) | 35% |
|
| 2. Grid Reliability / Energy Security | 10% |
|
| 3. Environmental Impact (COβ) | 10% |
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| 4. Regulatory Stability | 15% |
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| 5. Technology Maturity | 10% |
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| 6. Portfolio Synergy (curtailment priority, hybrid offset) | 20% |
Score each alternative 0β100 on each attribute. Defaults reflect typical Baltic project profiles documented in the thesis.
| Rank | Alternative | Utility Score | Verdict |
|---|---|---|---|
| β | β | β | β |
| β | β | β | β |
| β | β | β | β |
| β | β | β | β |
Key thesis upgrade: Conventional Β±20% sensitivity is structurally inadequate in a market that has produced β10,000 β¬/MWh events in Lithuania (30 March 2026), 18 Mβ¬ intraday excursions in Latvia (August 2025), and retroactive 10Γ municipal-tax shocks. These are regime shifts, not perturbations around a regime. This module stress-tests each strategy against four documented Baltic regime shifts and computes the robustness radius Ξ±Μ.
| Strategy | CAPEX (β¬M) | Expected Rev (β¬M/yr) | Break-even Rev | Ξ±Μ (Robustness) |
|---|---|---|---|---|
| A. Oversized β 200 MW, island-mode ready | β | β | ||
| B. Optimised β 100 MW, market-fit | β | β | ||
| C. Pilot + Expand β 25 MW + option | β | β |
Each scenario is drawn from a documented Baltic event (sources cited). For each strategy, we recompute net revenue under the regime shift and show whether DSCR survives.
Translates the most-cited thesis finding β that the Baltic BESS market is in a documented "hype cycle" (NorkeliΕ«nas, Tjurins) with inverted loss aversion ("FOMO > expected value") β into a structured 12-question audit. Output: a Bias Log that the framework requires you to revisit at every ROA gate.
Integrates outputs from Modules 1β5 into a structured Go / No-Go / Defer recommendation, archetype-specific decision rules, and an exportable Decision Pack. Re-run Steps 1, 4 and 5 at every investment gate; review the Principles Register at every quarterly investment committee.
Confirm each principle before issuing FID. Per Dalio (2017) and the thesis: a profitable decision reached through a violated principle accumulates rather than corrects organisational error.
| Dimension | DCF/NPV | ROA | MAUT | IGDT |
|---|---|---|---|---|
| Philosophy | Discounted cash certainty | Strategic flexibility | Multi-criteria trade-offs | Robustness under deep uncertainty |
| Uncertainty Type | Deterministic | Known probability (Ο) | Risk via utility | Deep β no distribution |
| Decision Rule | Max NPV | Max Expanded NPV | Max Expected Utility | Max Robustness Ξ±Μ |
| Ideal Baltic User | All β baseline filter | Merchant / PE | Mid-size IPP / Policy | Utility / TSO / Grid planner |
| Strength | Universal benchmark | Captures staging value | Integrates non-financial | Survives regime shifts |
| Limitation | Ignores flexibility | Needs Ο estimate | Subjective weights | Can be over-conservative |