Microgrid & Distributed Energy Equipment worked example

Project Margin with total project contract price of 63 $: a worked example in microgrid & distributed energy equipment

Here is what the math looks like when conditions slip. We hold every other input steady and drop total project contract price to 63 $, then walk the calculation through step by step. Estimate the gross margin on a microgrid or distributed energy project by comparing project price against delivered cost, so teams have a clean margin percentage for a go or no-go review.

The inputs for this scenario

  • Total project contract price: 63 $ (the input this scenario stresses; the baseline uses 125)
  • Delivered all-in project cost: 100 $ (held at the documented default)
  • Margin price basis (usually contract price): 100 $ (held at the documented default)

Working through the calculation

  • The calculation starts from the formula this tool documents: Project gross profit = project price - delivered project cost.
  • Project margin works out to -37 % at these inputs, and this is the headline figure for the scenario.
  • Project gross profit works out to -37 value at these inputs.
  • Project price works out to 63 value at these inputs.
  • Delivered project cost works out to 100 value at these inputs.

How this compares with the baseline

  • Against the tool's baseline example, where total project contract price sits at 125 $ and the headline result is 25 %, this scenario comes in 248% below the baseline at -37 %.
  • The practical read: the gap between this scenario and the baseline is entirely attributable to total project contract price, so recovering it is worth quantifying in dollars before considering equipment or staffing changes. It is a gross margin only — it excludes overhead, warranty reserves, and financing, so a healthy gross margin can still net to a loss on a long DER project.

Results at a glance

  • Project margin: -37 % (headline result)
  • Project gross profit: -37 value
  • Project price: 63 value
  • Delivered project cost: 100 value

Run it with your numbers

  • To rerun this with your own numbers, open the live Project Margin calculator, set total project contract price to your actual value, and adjust the remaining inputs to match your operation.

Last reviewed 2026-05-12.