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Life cycle cost analysis of 1MW power generation using roof-top solar PV panels

Life cycle cost analysis of 1MW power generation using roof-top solar PV panels PurposeThe purpose of this paper is to focus on life cycle cost analysis (LCCA) of 1 MW roof-top Solar Photovoltaic (PV) panels installed in warm and humid climatic region in Southern India. The effect of actual power generated from solar PV panels on financial indicators is evaluated.Design/methodology/approachLCCA is done using the actual power generated from solar PV panels for one year. The net present value (NPV), internal rate of return (IRR), simple payback period (SPP) and discounted payback period (DPP) are determined for a base case scenario. The effect of service life and the differences between the ideal power expected and the actual power generated is evaluated.FindingsA base case scenario is evaluated using the actual power generation data, 25-year service life and 6 percent discount rate. The NPV, IRR, SPP and DPP are found to be INR 13m, 8 percent, 10.9 years and 18.8 years respectively. It is found that the actual power generated is about one-third less than the ideal power estimated by consultants prior to project bidding. The payback period increases by 70–120 percent when the actual power generated from solar PV panels is considered.Originality/valueThe return on investment calculated based on ideal power generation data without considering the operation and maintenance related aspects may lead to incorrect financial assessment. Hence, strategies toward solar power generation should also focus on the actual system performance during operation. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Built Environment Project and Asset Management Emerald Publishing

Life cycle cost analysis of 1MW power generation using roof-top solar PV panels

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Publisher
Emerald Publishing
Copyright
Copyright © Emerald Group Publishing Limited
ISSN
2044-124X
DOI
10.1108/BEPAM-12-2018-0161
Publisher site
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Abstract

PurposeThe purpose of this paper is to focus on life cycle cost analysis (LCCA) of 1 MW roof-top Solar Photovoltaic (PV) panels installed in warm and humid climatic region in Southern India. The effect of actual power generated from solar PV panels on financial indicators is evaluated.Design/methodology/approachLCCA is done using the actual power generated from solar PV panels for one year. The net present value (NPV), internal rate of return (IRR), simple payback period (SPP) and discounted payback period (DPP) are determined for a base case scenario. The effect of service life and the differences between the ideal power expected and the actual power generated is evaluated.FindingsA base case scenario is evaluated using the actual power generation data, 25-year service life and 6 percent discount rate. The NPV, IRR, SPP and DPP are found to be INR 13m, 8 percent, 10.9 years and 18.8 years respectively. It is found that the actual power generated is about one-third less than the ideal power estimated by consultants prior to project bidding. The payback period increases by 70–120 percent when the actual power generated from solar PV panels is considered.Originality/valueThe return on investment calculated based on ideal power generation data without considering the operation and maintenance related aspects may lead to incorrect financial assessment. Hence, strategies toward solar power generation should also focus on the actual system performance during operation.

Journal

Built Environment Project and Asset Management – Emerald Publishing

Published: Sep 16, 2019

References

  • Financial performance and analysis of 100kwp rooftop grid connected solar PV plant in surat municipal corporation
  • Technical and economical assessment of the utilisation of photovoltaic systems in residential buildings: the case of Jordan