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The Investability of PV Systems under Descending Feed-In Tariffs: Taiwan Case

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  • Chun-Nan Chen

    (Graduate Institute of Finance, National Taiwan University of Science and Technology, Taipei 10607, Taiwan)

  • Chun-Ting Yang

    (Graduate Institute of Finance, National Taiwan University of Science and Technology, Taipei 10607, Taiwan)

Abstract

The Taiwanese government has set an energy transition roadmap of 20% renewable energy supply by 2025, including a 20 GW installed PV capacity target, composed of 8 GW rooftop and 12 GW ground-mounted systems. The main trend of feed-in tariffs is downwards, having fallen by 50% over a ten-year period. Predicting the future ten-year equity internal rate of return (IRR) in this study, we examine the investability of PV systems in Taiwan when subsidies and investment costs descend. We have found that the projected subsidies scheme favours investment in small-sized PV systems. Unless the investment costs of medium-sized PV systems fall or subsidies rise over the next decade, investing in medium-sized PV systems will be less attractive. Nonlinear and linear degradation causes slight IRR differences when using higher-reliability modules.

Suggested Citation

  • Chun-Nan Chen & Chun-Ting Yang, 2021. "The Investability of PV Systems under Descending Feed-In Tariffs: Taiwan Case," Energies, MDPI, vol. 14(9), pages 1-13, May.
    • Handle: RePEc:gam:jeners:v:14:y:2021:i:9:p:2728-:d:551726
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    1. Błaszczyk, Alfred & Matuszak-Flejszman, Alina & Nawrocki, Kamil, 2024. "Determinants of the development of photovoltaics in Poland," Renewable Energy, Elsevier, vol. 233(C).
    2. Rafael G. Nagel & Vitor Fernão Pires & Jony L. Silveira & Armando Cordeiro & Daniel Foito, 2023. "Financial Analysis of Household Photovoltaic Self-Consumption in the Context of the Vehicle-to-Home ( V2H ) in Portugal," Energies, MDPI, vol. 16(3), pages 1-21, January.
    3. Ludwik Wicki & Robert Pietrzykowski & Dariusz Kusz, 2022. "Factors Determining the Development of Prosumer Photovoltaic Installations in Poland," Energies, MDPI, vol. 15(16), pages 1-19, August.
    4. Saad Odeh & Tri Hieu Nguyen, 2021. "Assessment Method to Identify the Potential of Rooftop PV Systems in the Residential Districts," Energies, MDPI, vol. 14(14), pages 1-11, July.
    5. Hon Chung Lau & Steve C. Tsai, 2022. "A Decarbonization Roadmap for Taiwan and Its Energy Policy Implications," Sustainability, MDPI, vol. 14(14), pages 1-34, July.

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