The real options as valuation methodology for a project in the electrical sector
This paper intends to apply the theory of real options in a construction project for a small hydroelectric power station in Colombia. The calculation of the net present value and the internal rate of return indicate that the project is viable, however, these methodologies are unaware of the option o...
- Autores:
-
Támara Ayús, Armando Lenin
Forero Corrales, Julián
Gil Osorio, Isabella
Almonacid Hurtado, Paula María
- Tipo de recurso:
- Fecha de publicación:
- 2020
- Institución:
- Universidad EAFIT
- Repositorio:
- Repositorio EAFIT
- Idioma:
- spa
- OAI Identifier:
- oai:repository.eafit.edu.co:10784/15494
- Acceso en línea:
- http://hdl.handle.net/10784/15494
- Palabra clave:
- G17
G12
G19
Real options
Expansion option
Binomial trees
Energy sector
Opciones reales
Opción de expansión
Árboles binomiales
Sector energía
- Rights
- License
- Copyright (c) 2011 Daniela Fleisman, Andrés Mauricio Mora
| Summary: | This paper intends to apply the theory of real options in a construction project for a small hydroelectric power station in Colombia. The calculation of the net present value and the internal rate of return indicate that the project is viable, however, these methodologies are unaware of the option of expansion existing in said project. The article presents the calculation of this option based on the binomial tree methodology, where volatility is obtained through an EGARCH model based on the daily returns of energy prices. It is concluded that the real option makes the project viable, while developing tools that help to work this type of case in the valuations of projects belonging to the energy sector. |
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