Reality has several. DRR returns a percentage you can hold against your hurdle rate — your IRR, but computed across every plausible future and priced for the flexibility you hold and the risk you add to the portfolio. Not a new metric to learn. A better version of the one you use.
Classic net present value compresses the future into a single assumption. DRR adds in euros — robust against estimation error rather than multiplicatively fragile.
Scenario-weighted IRR over base, upside and stress — a distribution, not a point estimate.
We penalize the real loss case, not volatility. Upside should never be taxed as if it were risk.
Abandon, defer and scale options enter as a clean real-options value — added, never a gut-feel multiplier.
A project correlated with everything else raises total risk. That marginal contribution is subtracted.
No abstract 0–500 score. A percentage you can hold against your hurdle rate directly — with the euro breakdown one click away.
Because it's additive, each contribution can be questioned in isolation. No black box of four multiplied factors.
The fair first question from any CFO. Here is the honest answer.
| Criterion | NPV / IRR | RAROC | Real options | DRR |
|---|---|---|---|---|
| Multiple scenarios | — | — | Yes | Yes |
| Asymmetric downside risk | — | Yes | — | Yes |
| Value of flexibility | — | — | Yes | Yes |
| Portfolio correlation | — | Yes | — | Yes |
| For industrial projects, not just banks | Yes | — | Yes | Yes |
| Explainable to a board | Yes | Yes | — | Yes |
In short: DRR is the substance of real options in the language of RAROC — translated for industrial projects and an investment committee, not a quant desk.
Same units as your IRR. Pull the levers and watch the resilient return move — the gap to base-case IRR is the price of your assumptions.
Formula: DRR% = E[IRR] − λ·max(0, −IRRstress)·Pstress + option − ρ·k·|E[IRR]|. The same metric as your IRR — computed on resilient cash flows instead of the base case. The spread is the price of your assumptions; the € breakdown keeps every term auditable.
The Renewable Asset Listing Standard — an open standard that turns scattered PDFs and spreadsheets into one machine-readable asset profile. RALS makes assets comparable; DRR makes the decision on them defensible. DRR consumes RALS — it doesn't replace it.
Licensed CC BY 4.0, RFC-gated governance. A shared, vendor-neutral lingua franca for renewable asset data — not a product to buy.
Grid evidence, hourly generation profile, the revenue stack with real €/MWh and contract end dates, curtailment history, permits and readiness — structured and comparable.
DRR can only score what's structured. A RALS profile is exactly the input the calculator and the scorer above consume — that's why the upload accepts RALS JSON.
Learn the schema and governance at rals.energy.
Upload a RALS asset (or a portfolio array) as JSON. DRR derives the scenarios and scores each asset right here in your browser — three models, auto-detected: heuristic risk indices, single-period €/MWh prices, or full-life cash flows with contract roll-off.
Prefer a full page? Open the scorer standalone ›
At its core, yes — and that's the strength. We don't invent a new theory; we add the three things a single-scenario IRR structurally ignores: multiple futures, the price of flexibility, and the contribution to portfolio risk. Set λ=0, one scenario, no options, and DRR collapses exactly onto your IRR.
That's the real work — and our core product. We provide industry-specific default calibrations plus a guided workshop in which your investment committee fixes λ and the scenario weights once. After that, every project runs through the same consistent filter. See the calibration step →
Multiplied factors amplify estimation error: a small mistake in correlation flips the entire ranking. Additive terms are robust and — crucially for a board — each can be questioned in isolation instead of disappearing into a black box.
30–90 days. Weeks 1–2: calibration workshop. Weeks 3–6: re-score your existing portfolio (this almost always reveals two or three projects that should be ranked differently). Then: an Excel/Sheets plug-in in the committee's daily flow. See the full adoption path →