We now have the operating cash flow worked out with revenue and operating costs, but none of that revenue will occur, nor will any of the operating costs be incurred until we've actually built the underlying equipment that can generate the power, and that's what we call capital expenditure or CapEx. We need to add in construction costs. We need to know how much they might be and when do we incur those costs. Some of the components may be all of them may be imported, so we will need to work out at what exchange rate. We will translate those foreign invoices and what happens if the exchange rate changes during the construction period. We should also consider what happens if the project is delayed or even pulled ahead. If we know the capital expenditure, we could also work out the depreciation. That's not a cash cost. It won't affect our cashflow, but if we're doing an income statement, we'll need to use it there. All the CapEx is our upfront investment. It will need to be funded by some combination of shareholders, equity and debt. That's because there's no revenue happening yet to pay for it. We need to spend this money in advance of the revenue occurring, so someone needs to fund it. What kind of capital expenditure costs might there be? If we look, for example, at a wind farm, we could have the supply of the actual turbines themselves and their installation, the remainder of the equipment that will connect the turbines to each other and to a control room. The cost of the control room and the instrumentation.

The pre-construction engineering, leveling out the land and ensuring it is suitable for construction. The cost of connecting the turbines or other equipment we're using to the national grid. If we lease the land on which the renewable energy project will be located, we don't own it ourselves. There will be a cost for leasing that land. There could be an upfront fee in addition to ongoing rental, we also need to consider the land corridors that might be needed to house the power lines that connect our project to the national grid. And when we are doing cost estimates, there will almost certainly be some type of contingency on top of those estimated construction costs. We also need to include what we might call soft costs. Costs that are not actual physical equipment, but are needed in order for the program to go ahead. The cost of advisors, legal fees, the cost of preparing and auditing a financial model. The costs of advisors employed by the lenders such as technical advisors, insurance advisors, legal advisors, all of these costs are part of capital expenditure, but in common with other capital expenditure. We shouldn't simply use our own cost estimates. As the model creators, we should always try and find the cost estimates from a subject matter expert who has the best and most up-to-date view of the capital costs. And this will be a moving and constantly evolving set of numbers. At first, we might do a very high level estimate, X many pounds or dollars or euros per megawatt of capacity. As the project matures and gets closer to its financial close, those cost estimates will become more refined, and our inputs for capital expenditure need to be flexible so we can continuously update them as we obtain better and better information.