Beyond the Point Estimate: Why Every Sims Study Reports a P90 IRR
A sizing number is a guess with confidence attached. Every Ingro Sims study runs 600 sampled cases across ten assumptions; on one industrial site the 30.4% point-estimate IRR held at 21.6% at P90, well clear of a 12% hurdle.
Most sizing tools give you a number. But a single number is a guess with confidence attached: it describes the project's best day, not the range of conditions it will actually live through.
Every Ingro Sims study therefore runs 600 sampled cases across ten assumptions — among them grid tariff level, tariff escalation, capex, solar yield, capacity fade and plant availability — and reports the range the project survives, not just its best case.
Point estimate vs P90
On an industrial site sized the previous week:
- Point estimate: 30.4% project IRR
- P90: 21.6% — the conservative end, where nine cases in ten come out better
- Hurdle rate: 12%
The project clears the hurdle across the whole range. That is a far stronger statement to put in front of an investment committee than a single IRR figure.
The tornado shows where to spend diligence
The sensitivity tornado ranks each assumption by how far it moves the IRR on its own. On this site:
- Grid tariff level swings the IRR by 16.4 points by itself
- O&M assumptions move it by just 0.7 points
The practical lesson: put your diligence into the tariff assumption, and stop arguing about O&M. A ranked view of risk tells developers, lenders and buyers which inputs deserve scrutiny and which barely matter to the outcome.
Ranges, not guesses
Reporting P90 alongside the point estimate turns a sizing study from a single optimistic number into a defensible range. It is built into every Sims study at sims.ingroenergy.com.
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