1

Using these annual PVFs and an annual end-of-the-year positive net cash flow of $100,000, the PV of each of the cash flows over the three year period would be calculated as:

Thus, given an interest or discount rate of 10%, were one to consider $1,000 of savings in Year 10 as equivalent to $1,000 in the present, conclusions drawn from the analysis would be erroneous. Conversely, the FV of a present sum of money (PV) over n periods at an interest rate i per period would be calculated as:

Year

Renewable Energy 101

Renewable Energy 101

Renewable energy is energy that is generated from sunlight, rain, tides, geothermal heat and wind. These sources are naturally and constantly replenished, which is why they are deemed as renewable. The usage of renewable energy sources is very important when considering the sustainability of the existing energy usage of the world. While there is currently an abundance of non-renewable energy sources, such as nuclear fuels, these energy sources are depleting. In addition to being a non-renewable supply, the non-renewable energy sources release emissions into the air, which has an adverse effect on the environment.

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