economics of photovoltaic systems original presentation by j. m. pearce, 2006 email:...
TRANSCRIPT
Economics of Photovoltaic Systems
Original Presentation by J. M. Pearce, 2006 Email: [email protected]
PV Economics Basics
• Solar Photovoltaic Cells convert sunlight directly into electricity
• They are sold on a $/Wp basis or $/power• Wp is the power in Watts for Peak sun hours
-- the equivalent number of hours per day, with solar irradiance equaling 1,000 W/m2, that gives the same energy received from sunrise to sundown.
• To convert power to energy simply multiply by the amount of time that the cell is illuminated – W * hr = 1 W-hr
• Electricity (energy) is normally billed $/kW-hr
Economics of a Solar Electric Home
• A typical American uses ~ 9,000 kW-hrs/year
• A well-designed U.S. home needs 4kW-5kW of PV to provide for its energy needs averaged throughout the year– Depends on location (solar flux)– Energy use of home– Because calculating on /Wp basis you do
not need to worry about efficiency
How much for a Solar Electric House?
• The 2nd presentation discussed the components of a grid-tied solar home system
• The price tag for the complete installed system including all labor as of 2006 is between $5/Wp to $10/Wp
• For a 4kW system: – 4000Wp x $5/Wp = $20,000 – 4000Wp x $10/Wp = $40,000
Cost of Energy Production
Photovoltaic cells: $0.20-0.40 per kW-hr
Wind turbines: $0.04-0.05 per kW-hr
Gas: $0.02-$0.03 per kW-hr
Coal: < $0.03 per kW-hr
Financing PV
• For new homes a PV system can be folded into the mortgage – long term low interest loan
• For retrofits of existing homes PV can be economic with:– Financial assistance through grants,
subsidies, or other incentives– High costs of electricity in your area– Green power purchase agreements– Off-grid Applications
PV Incentives• One stop shop for financial incentives is
www.dsireusa.org/• The Database of State Incentives for Renewable
Energy (DSIRE) is a comprehensive source of information on state, local, utility, and federal incentives that promote renewable energy.
• Lists includes:– Corporate Tax Incentives – Direct Equipment Sales – Grant Programs – Leasing/Lease Purchase Programs – Loan Programs – Personal Income Tax Incentives – Production Incentives – Property Tax Incentives – Rebate Programs – Sales Tax Incentives
Where PV makes Economic Sense Now
• Remote sites that are too far from power• Or where the power is too unreliable for
a given application (e.g. internet server) – Costs for power lines range from $8000 to
$75,000 per mile. – As a general rule, if you are more than ½
mile from a line, solar is probably the best alternative.
PV : Cheap Electricity
for Road WorkIn areas that have grid power, where the cost of tearing up the streets and/or other construction are expensive.
Portable Radio Station
The Developing
World
Stand Alone Systems
Coast Guard Stationsand Aircraft
Bus Stops and Emergency Phones
Solar in Space
Parking Lights
Running Trails and Lighthouses
Solar powered monaste
ries!
When will PV make economic sense for me?
Economy of Scale
0 subsidiesGrid-tied Market
$3.12/Wp to $3.56/Wp
Industry-Developed PV Roadmap
World PV Module Production (MW) Increases
1988 19891990 19911992 1993 19941995 1996 19971998 1999 2000 20010
100
200
300
400
Rest of worldEuropeJapanU.S.
33.6 40.2 46.5 55.4 57.9 60.1 69.4 77.6 88.6125.8
154.9
201.3
287.7
390.5
2002
512.2500
Source: PV News, March 2003
World PV installations in 2004 rose to 930MW -- growth of 62 % Consolidated world production of PV now 1.15 GW+
PV System vs. Electricity Costs
0
4
8
12
16
20
24
28
32
36
40
44
$0.00$1.00$2.00$3.00$4.00$5.00$6.00$7.00$8.00$9.00
Installed PV System Cost ($/Wp)
Cos
t of
Gen
erat
ed E
lect
rici
ty (
cen
ts/k
Wh
)
Pennsylvania Retail Rate
Japanese Retail Rate
German Retail Rate
Additional Assumptions:System Lifetime = 20 yearsReal Interest Rate = 6%O&M = 0.1 cent per kWh
Capactiy Factor = 0.25(South West U.S)
Capacity Factor = 0.2(U.S. Average)
California Retail Rate
What you can do• Energy consumers would sign up on
www.iwillifyouwill.org• Give names, addresses, phone numbers, e–mail
addresses, and "pledge levels." • Your pledge level would indicate how many peak
Watts of solar panels you would be willing to purchase based on the price of an installed system.
• Your identifying information would be kept confidential; however, your participation level would be posted on a publicly accessible Web site.
• In this way consumers become "subcontractors" to the major solar cell manufacturers providing needed market data
New Technology Could Play a Role
• Heterojunction with Intrinsic Thin-layer
• Sanyo • 18.5%• 30MW (by the end of FY
2003: coupled with current production boost total output to 60MW)
• Annual production is increased to 120 MW in 2005.
Built-in Incentives
$/W ValueMaterial avoidedby BIPV Installation
Material Credit
$1/sq-ft
$5/sq-ft
$10/sq-ft
$20/sq-ft
Asphalt Shingle roof, monolithic glazingLaminated glass w/coatingsmetal roofing/claddingRoofing slates, clay tile,high performance coatingsStainless steel,photochromic glass
$0.10/W
$0.50/W
$1/W
$2/W
Building Material Replacement Value
Utilizing Financial Incentives
Subsidies for Fossil Fuel
• Fossil fuels and nuclear energy receive 90% of the government money, (with PV receiving <3%).
• Hidden costs that we all subsidize for the energy industry which include: – Air pollution leads to the death of
120,000 Americans every year and costs $40 billion in health care annually. /
– Hidden Subsidies – pollution, global climate change, war• Military (U.S. military spends billions/yr just
defending the oil supplies in the Persian Gulf).
The Question of Energy Unemployment
• If we switch to solar what about all the fossil fuel jobs?
• A 1997 Pembina Institute report found that for every million dollars invested:– 36.3 jobs are created in the energy
efficiency sector– 12.2 in the renewable energy sector – conventional energy only 7.3 jobs are
created.
PV: Net Job Producer!
Jobs created with every million dollars spent on:– oil and gas
exploration: 1.5 – on coal mining:
4.4 – on producing
solar water heaters: 14
– on photovoltaic panels: 17
Jobs Coal vs. Solar
– Coal only employs 80,000
– By 2010, approximately 70,000 new jobs could be created as a result of the increased demand through the installation of only one million solar energy systems (3%).
People Want Solar
• The Program on International Policy Attitudes found that the American public wants the federal budget for renewable energy research like solar PV to increase by 1090 %.
Solar Photovoltaics is the Future
Acknowledgements
• This is the fourth in a series of presentations created for the solar energy community to assist in the dissemination of information about solar photovoltaic cells.
• This work was supported from a grant from the Pennsylvania State System of Higher Education.
• The author would like to acknowledge assistance in collecting information for this presentation from Heather Zielonka.