An energy manager is preparing a proposal to senior management for a project to

upgrade a gas boiler. The boiler itself costs $20,000$ and the installation will cost

$5,000.$

Based on her audit she estimates that it will save $212\mathrm{.}5MWh$ per year. The current

cost of gas is $0\mathrm{.}04kWh$ and the price is guaranteed for the next $4$ years.

The company policy is that any investments must achieve an IRR of at least $15\%$ over

$4$ years.

Q$6$ Approximately what IRR does the project achieve?

$[20$ Marks$]$

Q$7$ How much grant support would the project need to receive to get backing?