Perspective

A Pre-DD screen is not a feasibility study

Perspective 19 June 2026 5-minute read No. 02

A feasibility study tries to prove a project works. A Pre-DD screen does the opposite job: it goes looking for where the project breaks — in approvals, on the ground, at the connection, or in the cashflow — while the answer is still cheap to act on. This note sets out how the F1–F4 workflow does that.

At a glance
  1. The useful early-stage output is not a single number. It is a sharper decision: proceed, redesign, reduce scope, pause or stop.
  2. An industrial PV+BESS project is not just an energy model — it is a bundle of approval, land, connection, contract and cashflow risk. A pretty IRR that ignores four of those five is not a project.
  3. F1–F4 screen the four places a project actually breaks: approval delta, site suitability, microgrid / connection boundary, and financeability readiness.
  4. Inside those sit five working questions — technical fit, customer avoided cost, contract revenue, carbon value, bankability. Most failures happen at the boundary between two of them.
  5. A good screen does not remove uncertainty. It makes uncertainty visible early enough that the project can still be reshaped cheaply.

Why this matters

Most early industrial energy conversations start with hardware — array size, battery duration, inverter choice, container layout — and end with an IRR. The problem is that a feasibility-study mindset arrives too early. It spends effort proving a chosen design works, before anyone has checked whether the project can be approved, sited, connected and financed at all. By the time those questions surface, real money has been committed to the wrong version of the project.

A Pre-DD screen is deliberately cheaper and more sceptical. Its job at this stage is not to produce a bankable model — it is to find, from public information, where this specific project is most likely to break, and whether that break can still be designed around. That is a different instrument for a different moment.

The useful output is a decision, not a number

Early-stage data is soft by nature: load is approximate, diesel prices move, EPC costs are indicative, customer credit is unverified, debt terms are unnegotiated. A screen that pretends otherwise — that hands over a precise IRR to three decimal places — is selling false confidence. The honest output is a decision the project owner can act on:

Proceed as-is, redesign the structure, reduce the scope, pause for missing data, or stop.

Each of those is a good outcome if it is reached early. “Stop” on a public-data screen costs a few weeks. “Stop” after EPC quotation, legal structuring and investor engagement costs a great deal more.

An industrial PV+BESS project is not an energy model

A spreadsheet can make almost any project look attractive if it is allowed to assume the hard parts away. The hard parts are rarely the energy balance. They are:

  • Approval — does the project fit the existing pathway, or trigger new disturbance, licence, water, heritage or closure issues?
  • Land and site — is there somewhere the equipment can physically and legally sit?
  • Load and connection — what slice of the load can actually be served, and where is the microgrid boundary?
  • Contract — can the value be converted into a payment obligation someone is bound to pay?
  • Financeability — does the resulting cashflow support debt on terms a lender will accept?

F1–F4: a practical screen

The four screens map onto exactly those break points. They are run together, not in strict sequence — but each asks one clear question.

F1 · Approval Delta

What new approvals, variations or conditions does adding PV+BESS trigger, relative to the site’s existing consents? The delta — not the absolute approval burden — is what adds time and risk.

F2 · Site Suitability

Where can the array, storage, PCS and interconnection realistically go, given layout, setbacks, watercourses, roads, pipelines and closure areas visible on public maps? “Empty land” on satellite is not the same as usable, consentable land.

F3 · Microgrid / Connection Boundary

What load slice can actually be served, and how do PV, BESS, diesel, PCS, EMS and site loads connect? This sets the boundary the commercial case has to live inside — explored in Weak-grid mines do not buy cheap energy.

F4 · Financeability Readiness

Which cashflow can be contracted, invoiced and underwritten? This is where customer savings and project revenue get separated — the subject of the first mistake in BTM BESS feasibility.

The five questions inside the screen

Underneath F1–F4 sit five working questions I keep returning to. They are not a checklist to tick in order — they interact, and most projects fail at a boundary between two of them:

  • Technical fit — is the system sized to the real, predictable load, not the rare peak?
  • Customer avoided cost — what does the customer genuinely stop paying, against a credible baseline?
  • Contract revenue — how much of that avoided cost becomes stable, contracted SPV revenue?
  • Carbon value — is it quantified, correctly assigned, and kept out of double-counting?
  • Bankability — does the contracted revenue support debt service at a coverage ratio a lender will accept?

Notice that four of the five are commercial and financial, not technical. Whether the battery works is rarely the binding question. Whether the project can be paid for, contracted and financed — and for whom it actually creates value — is where it lives or dies.

The model should not only ask: what is the IRR? It should ask: what contract produces that IRR, and would anyone lend against it?

The Pre-DD takeaway

This note is the spine of the series: it maps the whole F1–F4 Pre-DD workflow — Approval Delta, Site Suitability, Microgrid / Connection Boundary and Financeability Readiness. The other notes go deep on individual screens; this one is the frame they hang from. A good screen does not pretend to remove uncertainty — it makes uncertainty visible early enough that the project can still be reshaped.
Where would this project break first — and can we still reshape it before that break becomes expensive?
Basis Written from public information and Heliovulcan’s own screening work. Where an external source informs the argument, it is named in the text rather than absorbed into it.
Status Analytical note on project logic at screening grade. Not legal, financial, tax, engineering, investment or formal due-diligence advice, and not a financial product recommendation. Any figure should be independently verified before a commercial decision.