*4.2. Sensitivity Analysis*

Since all costs were based on estimates, it is possible that the estimates might not be accurate. It is then essential to evaluate the breakeven points for both CAPEX and NAR. These values were evaluatedusingEquations(4)and(5),adjustedfor RGTSUandRGTPJasfollows:

 For RGTSU:

 The adjusted sensitivity equation for CAPEX:

$$\text{PW(IRR)} = 0 = -89.34(1+\text{x}) + \text{(Annual Revenue - OPEX)}\_{\text{N}} \text{ (P/A, IRR, N)} + 0.02 \text{(89.34)(P/F, } \Delta \text{/s)} \text{ (N} = 5, 10, 15 \text{ and 20.} \tag{7}$$
 
$$\text{IRR, N}), \text{N} = 5, 10, 15 \text{ and 20.}$$

The adjusted sensitivity equation for net annual revenue (NAR):

$$\text{PW(IRR)} = 0 = -89.34 + \text{(Annual revenue - OPEX)}\_{\text{N}} \text{(1+y)} \text{ (P/A, IRR, N)} + 0.02 \times 89.34 \text{(P/F, } \space \text{IRR, N)}\_{\text{r}} \text{N} = 5,10,15 \text{ and } 20.$$

For RTJPJ:

The adjusted sensitivity equation for CAPEX:

$$\text{PW(IRR)} = 0 = -39.9(1+\text{x}) + \text{(Annual Revenue - OPEX)}\_{\text{N}} \text{ (P/A, IRR,N)} + 0.02(39.9) \text{(P/F, } \space \text{IRR, N)}, \space \text{N} = 5, 10, 15 \text{ and } 20.$$

The adjusted sensitivity equation for net annual revenue (NAR):

$$\text{PW(IRR)} = 0 = -39.9 + \text{(Annual revenue - OPEX)}\_{\text{N}} \text{(1} + \text{y)}\\\text{(P/A, IRR, N)} + 0.02 \times 39.9 \text{(P/F, } \space \text{IRR, N)}, \space \text{N} = 5, 10, 15 \text{ and } 20.$$

Using Equations (7)–(10) and taking the forecasted annual revenue, OPEX, and the evaluated IRR for the respective project life of 5, 10, 15, and 20 years, the values of x and y were calculated for both RGTPJ and RGTSU, respectively. The evaluated results are included in Table 5.

**Table 5.** Sensitivity of Internal rate of return for Capital expenditure and Nett annual revenue


For RGTPJ, the sensitivities for CAPEX are 0.34%, 0.34%, 0.34%, and 0.34% for years 5, 10, 15, and 20, respectively. For NAR, the sensitivities are −1.7%5, −1.75%, −1.75%, and −1.74% for years 5, 10, 15, and 20, respectively.

For RGTSU, the CAPEX sensitivities are NA, 0.83%, 0.8%, and 0.82% for years 5, 10, 15, and 20, respectively. While for NAR, sensitivities are NA, −1.54%, −1.55%, and −1.55% for years 5, 10, 15, and 20, respectively.
