# Commission Decision (EU) 2015/658 of 8 October 2014 on the aid measure SA.34947 (2013/C) (ex 2013/N) which the United Kingdom is planning to implement for support to the Hinkley Point C nuclear power station (notified under document C(2014) 7142) (Only the English version is authentic) (Text with EEA relevance), Division

Extent: E+W+S+N.I.

Table 4
Summary of approaches taken for analysing an appropriate rate of return, by KPMG
Source: Notification, Table 5, based on KPMG
(per cent)
Approach
Range of returns (project IRR; post-tax nominal)
Comments
Relative risk analysis
8,5-11
(project basis)
Comparison of offshore wind and PPP/PFI returns during construction phase and also UK regulated utilities/nuclear operators during operations phase
Benchmarking Analysis
6-13
(project basis)
Comparison of UK regulated utility/PPP/IWPP/comparable nuclear projects
Project Hurdle Rate analysis
10,5-14,5
Based on EdF WACC estimates plus premium observed in academic studies from a range of corporates
Financing analysis
9-13 — construction
6-9,5 — operational
Analysis of potential financing structures both during construction and during operations
Assumed debt-financed structure with UK Guarantee
10,2 — Project IRR
12,8 — Levered Equity IRR
Analysis of the Project Return and the Levered Equity Return (for the proposed UK guaranteed debt levels) and at the negotiated SP.
The 10,2 % is due to the tax shield effect on project level cash flows and indicative IUK Guarantee pricing.

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Source: https://www.legislation.gov.uk/eudn/2015/658/annex/A/division/2 (the official version)
Page: https://openlegislation.uk/eu-decision-2015-658/annex-A/division-2
Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives.