Techno-economic assessment or Techno-Economic Viability (TEV) (abbreviated TEV ) is a methodology framework to analyze the technical and economic performance of a process, product or service. TEV Study focuses mainly four broad aspects viz. technical feasibility, financial feasibility, economic viability, managerial competence are to be examined to ascertain whether the project will be technically feasible, economically viable, financially sound, professionally managed and ultimately to see whether it is viable as a commercial proposition.
The examination of this item consists of an assessment of various requirements for implementation of the project, production technology, optimum utilization of installed capacity, availability of utilities and inputs, quality of products etc.
This is to be examined with reference to market demand – supply scenario vis-à-vis the project’s production capacity, market price of the product vis-à-vis unit cost of production, etc.
This to be examined with reference to the projected profitability, cash flow, Internal Rate of Return (IRR), Debt Service Coverage Ratio (DSCR), Sensitivity to adverse scenario etc.