## 6 Financial Feasibility Study and Sensitivity Analysis  
Conducting a feasibility study is crucial for assessing the viability and potential success of any solution and comparing different financing mechanisms for the same project. Thus, under the three previously discussed scenarios, we conducted a Net Present Value (NPV) analysis to compare the savings generated from each of the three considered billing systems as a financing mechanism for the rooftop solar PV system. An NPV analysis is a financial technique used to evaluate the profitability of an investment or project by comparing the present value of its expected cash inflows with the present value of its expected cash outflows. It is based on the principle that a dollar received in the future is worth less than a dollar received today due to the time value of money. It is assumed that the initial cost of the solar PV system (with or without BESS) is covered by a bank loan over 10 years at an interest rate of 6%. The applied discount rate, which reflects the opportunity cost of capital or the minimum acceptable rate of return for the investment, is 10%. The discount rate is used to return future cash flows to their present value. It accounts for the riskiness of the investment, inflation, and the time value of money. All the assumptions considered to conduct the NPV analysis are shown in Table 4.  
Figure 11: Consumers savings from buying energy from Prosumers A and B.  
Figure 12: Consumers savings from buying energy from Prosumers A\({}^{\prime}\) and B. The NPV analysis results for the different billing mechanisms under scenarios 1 and 2 are shown in Figures 13 and 14. These results indicate that the P2P energy trading model favors the prosumer's investment in larger DER solutions since the NPV of the 12.8 kWp solar PV system is higher than the one for the 10 kWp system, which is not the case for the NEM billing system where a smaller size system would be more beneficial. Hence, a P2P energy trading mechanism can be considered as an incentive mechanism that encourages higher investments in DER solutions since it enables its users to exploit the full potential of their systems in an open market. Additionally, the NPV analysis results under scenario 3 (Figure 15), as compared to the P2P NPV results shown in Figure 13, proves that there is no profit from adding a BESS since even though it generates additional savings for the prosumer, the generated savings are not enough to increase the financial viability of the system. On the other hand, the results of our simulation model are affected by various factors, thus the necessity of conducting a sensitivity analysis. The first step in sensitivity analysis is to identify the key variables or assumptions that have the most significant impact on the analysis outcome. These variables are listed hereafter:  
* Negotiated price for the P2P energy trading as compared to the NEM and FiT utility set rates;
* Applicable utility tariff structure;
* Peak power of the rooftop PV system;
* Prosumers' demand load profile;
* Consumers' demand profiles;
* Storage capacity of the BESS; \begin{table}
\begin{tabular}{c c c c} \hline \hline  & \multicolumn{2}{c}{**Main Parameters**} & \\ \hline Initial cost of investment (USD) & & & \\ for 12.8 kWp solar PV & & & \\ \hline Initial cost of investment (USD) & & & \\ for 10.8 kWp solar PV & & & \\ \hline Initial cost of investment (USD) & & & \\ for BESS & & & \\ \hline Grace period (years) & 0 & & \\  & & & \\  & & & \\ \hline \hline \end{tabular}
\end{table} 
Table 4: Feasibility study parameters. Figure 13: Scenario 1 NPV—all prosumers. Considering the P2P energy trading negotiated price, if this rate is lower than the utility tariff, it would be considered a more appealing option for consumers. It increases the demand for traded energy, increasing the prosumer's revenue and the consumer's savings.