IDEAS home Printed from https://ideas.repec.org/a/eee/renene/v57y2013icp137-143.html
   My bibliography  Save this article

A comparison of the cost and financial returns for solar photovoltaic systems installed by businesses in different locations across the United States

Author

Listed:
  • Swift, Kenton D.

Abstract

Depending on what one reads, the cost of solar photovoltaic energy systems (solar PV systems) has already reached parity with grid produced electricity or, at the other extreme is far from parity. This leaves potential end users who are considering the installation of solar PV systems confused as to whether such an investment makes economic sense. These contrasting views are not surprising for several reasons. First, many analyses of the costs and financial returns of solar PV systems ignore important factors impacting the potential costs of such systems. Second, the factors impacting costs and financial returns such as levels of solar insolation, government and utility incentives, and the cost of grid produced electricity vary dramatically based on location. Finally, the cost of solar PV systems is declining rapidly over time. This study compares the costs and financial returns of solar PV systems installed by businesses, to grid produced electricity, in four specific locations across the US for 2012. The amounts are calculated after taking into account local solar insolation, and all available tax incentives and other available incentives and rebates. The results demonstrate that costs and financial returns of solar PV systems vary dramatically depending on the location where they are installed. The differences are primarily the result of variations in state incentives, electricity prices, and the level of solar insolation. This confirms that detailed, site specific, information about incentives, grid produced electricity rates, and levels of solar insolation is needed to determine whether the installation of a solar PV system makes economic sense in a particular location.

Suggested Citation

  • Swift, Kenton D., 2013. "A comparison of the cost and financial returns for solar photovoltaic systems installed by businesses in different locations across the United States," Renewable Energy, Elsevier, vol. 57(C), pages 137-143.
    • Handle: RePEc:eee:renene:v:57:y:2013:i:c:p:137-143
    DOI: 10.1016/j.renene.2013.01.011
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0960148113000360
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.renene.2013.01.011?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Jia, Teng & Dai, Yanjun & Wang, Ruzhu, 2018. "Refining energy sources in winemaking industry by using solar energy as alternatives for fossil fuels: A review and perspective," Renewable and Sustainable Energy Reviews, Elsevier, vol. 88(C), pages 278-296.
    2. Kim, James Hyungkwan & Mills, Andrew D. & Wiser, Ryan & Bolinger, Mark & Gorman, Will & Crespo Montañes, Cristina & O'Shaughnessy, Eric, 2021. "Project developer options to enhance the value of solar electricity as solar and storage penetrations increase," Applied Energy, Elsevier, vol. 304(C).
    3. Lee, Minhyun & Hong, Taehoon & Koo, Choongwan, 2016. "An economic impact analysis of state solar incentives for improving financial performance of residential solar photovoltaic systems in the United States," Renewable and Sustainable Energy Reviews, Elsevier, vol. 58(C), pages 590-607.
    4. Fokaides, Paris A. & Kylili, Angeliki, 2014. "Towards grid parity in insular energy systems: The case of photovoltaics (PV) in Cyprus," Energy Policy, Elsevier, vol. 65(C), pages 223-228.
    5. Mahelet G. Fikru & Gregory Gelles & Ana-Maria Ichim & Joseph D. Smith, 2019. "Notes on the Economics of Residential Hybrid Energy System," Energies, MDPI, vol. 12(14), pages 1-18, July.
    6. Theodoros Anagnostopoulos & Grigorios L. Kyriakopoulos & Stamatios Ntanos & Eleni Gkika & Sofia Asonitou, 2020. "Intelligent Predictive Analytics for Sustainable Business Investment in Renewable Energy Sources," Sustainability, MDPI, vol. 12(7), pages 1-11, April.
    7. Jiménez-Castillo, G. & Muñoz-Rodriguez, F.J. & Rus-Casas, C. & Talavera, D.L., 2020. "A new approach based on economic profitability to sizing the photovoltaic generator in self-consumption systems without storage," Renewable Energy, Elsevier, vol. 148(C), pages 1017-1033.
    8. Kim, Hakpyeong & Choi, Heeju & Kang, Hyuna & An, Jongbaek & Yeom, Seungkeun & Hong, Taehoon, 2021. "A systematic review of the smart energy conservation system: From smart homes to sustainable smart cities," Renewable and Sustainable Energy Reviews, Elsevier, vol. 140(C).
    9. Aslani, Alireza & Wong, Kau-Fui V., 2014. "Analysis of renewable energy development to power generation in the United States," Renewable Energy, Elsevier, vol. 63(C), pages 153-161.
    10. Fikru, Mahelet G. & Gelles, Gregory & Ichim, Ana-Maria & Kimball, Jonathan W. & Smith, Joseph D. & Zawodniok, Maciej Jan, 2018. "An economic model for residential energy consumption, generation, storage and reliance on cleaner energy," Renewable Energy, Elsevier, vol. 119(C), pages 429-438.
    11. An, Jongbaek & Hong, Taehoon & Lee, Minhyun, 2022. "Determining the optimal trading price of electricity for energy consumers and prosumers," Renewable and Sustainable Energy Reviews, Elsevier, vol. 154(C).
    12. Pillot, Benjamin & de Siqueira, Sandro & Dias, João Batista, 2018. "Grid parity analysis of distributed PV generation using Monte Carlo approach: The Brazilian case," Renewable Energy, Elsevier, vol. 127(C), pages 974-988.
    13. Stamatios Ntanos & Grigorios Kyriakopoulos & Miltiadis Chalikias & Garyfallos Arabatzis & Michalis Skordoulis & Spyros Galatsidas & Dimitrios Drosos, 2018. "A Social Assessment of the Usage of Renewable Energy Sources and Its Contribution to Life Quality: The Case of an Attica Urban Area in Greece," Sustainability, MDPI, vol. 10(5), pages 1-15, May.
    14. MacDougall, Hillary & Tomosk, Steve & Wright, David, 2018. "Geographic maps of the impact of government incentives on the economic viability of solar power," Renewable Energy, Elsevier, vol. 122(C), pages 497-506.
    15. B. T. Wittbrodt & J.M. Pearce, 2015. "Total U.S. cost evaluation of low-weight tension-based photovoltaic flat-roof mounted racking," Post-Print hal-02119670, HAL.
    16. Bakhshi, Reza & Sadeh, Javad, 2018. "Economic evaluation of grid–connected photovoltaic systems viability under a new dynamic feed–in tariff scheme: A case study in Iran," Renewable Energy, Elsevier, vol. 119(C), pages 354-364.
    17. Armendariz-Lopez, J.F. & Luna-Leon, A. & Gonzalez-Trevizo, M.E. & Arena-Granados, A.P. & Bojorquez-Morales, G., 2016. "Life cycle cost of photovoltaic technologies in commercial buildings in Baja California, Mexico," Renewable Energy, Elsevier, vol. 87(P1), pages 564-571.
    18. Pillai, Gobind G. & Putrus, Ghanim A. & Georgitsioti, Tatiani & Pearsall, Nicola M., 2014. "Near-term economic benefits from grid-connected residential PV (photovoltaic) systems," Energy, Elsevier, vol. 68(C), pages 832-843.
    19. Yoo, Hyunji & Hong, Taehoon & Jeong, Kwangbok & Ji, Changyoon, 2018. "Estimation of the optimal government rebate for promoting the photovoltaic system in multi-family housing complexes," Renewable and Sustainable Energy Reviews, Elsevier, vol. 91(C), pages 720-728.
    20. Lee, Minhyun & Hong, Taehoon & Yoo, Hyunji & Koo, Choongwan & Kim, Jimin & Jeong, Kwangbok & Jeong, Jaewook & Ji, Changyoon, 2017. "Establishment of a base price for the Solar Renewable Energy Credit (SREC) from the perspective of residents and state governments in the United States," Renewable and Sustainable Energy Reviews, Elsevier, vol. 75(C), pages 1066-1080.
    21. Talavera, D.L. & Pérez-Higueras, P. & Ruíz-Arias, J.A. & Fernández, E.F., 2015. "Levelised cost of electricity in high concentrated photovoltaic grid connected systems: Spatial analysis of Spain," Applied Energy, Elsevier, vol. 151(C), pages 49-59.
    22. Benson, Christopher L. & Magee, Christopher L., 2014. "On improvement rates for renewable energy technologies: Solar PV, wind turbines, capacitors, and batteries," Renewable Energy, Elsevier, vol. 68(C), pages 745-751.
    23. Jägemann, Cosima & Hagspiel, Simeon & Lindenberger, Dietmar, 2013. "The Economic Inefficiency of Grid Parity: The Case of German Photovoltaics," EWI Working Papers 2013-19, Energiewirtschaftliches Institut an der Universitaet zu Koeln (EWI).
    24. An, Jongbaek & Lee, Minhyun & Yeom, Seungkeun & Hong, Taehoon, 2020. "Determining the Peer-to-Peer electricity trading price and strategy for energy prosumers and consumers within a microgrid," Applied Energy, Elsevier, vol. 261(C).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:renene:v:57:y:2013:i:c:p:137-143. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.journals.elsevier.com/renewable-energy .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.