Cost of Capital and Capital Structure for a Renewable Energy Firm
Overview
What this challenge is about.
Model GreenGrid’s WACC with CAPM and new debt, then recommend on issuance to earn your verifiable certificate.
The scenario
GreenGrid Energy has €500M in total capital (30% debt, 70% equity), €150M EBIT, stable cash flows, and a strong credit rating. It operates in the regulated offshore wind market in Europe.
The Brief
What you'll do, and what you'll demonstrate.
Should GreenGrid Energy increase its debt-to-capital ratio from 30% to 50% to finance an offshore wind expansion, and what is the optimal capital structure?
Earning criteria — what you'll demonstrate
- Calculate the cost of equity using CAPM and cost of debt after tax
- Compute WACC and understand its components
- Analyze the impact of leverage on WACC and firm value
- Evaluate the trade-off between tax shields and financial distress costs
Program Fit
Where this fits in your program.
Sharpens the same skills your degree expects you to demonstrate.
Corporate Finance
Bachelor · Finance
Strong alignment
This challenge maps to Corporate Finance at the Bachelor level. It sharpens the same practical skills your coursework expects — but in a real industry context with actual constraints and deliverables.
Skills
Skills you'll demonstrate.
Each one shows up on your verified credential.
- Wacc
Apply wacc to solve real industry problems and demonstrate production-level capability.
- Capm
Apply capm to solve real industry problems and demonstrate production-level capability.
- Capital Structure
Apply capital structure to solve real industry problems and demonstrate production-level capability.
- Cost Of Capital
Apply cost of capital to solve real industry problems and demonstrate production-level capability.
- Financial Modeling
Build and validate financial models that support strategic business decisions.
Careers
Career paths this challenge builds toward
Completing this challenge demonstrates skills that transfer directly to these roles: