Calculation and Forecast of Photovoltaic Power Generation Cost

Photovoltaic cost The cost of electricity generation refers to the price per unit of electricity generated (one kilowatt-hour). The cost of electricity is used to calculate the true cost of photovoltaic power generation. The cost of electricity is the cost per kilowatt-hour, which covers all investment and operating costs of the PV system, including the cost of fuel consumed and equipment replacement. The use of electricity costs can make photovoltaic power generation systems comparable to any type of power plant.

The electricity cost calculation includes: the life cycle of the power station, investment costs, operation and maintenance costs, discount rate, and station location.

Technology, market type and target country The type of technology selected in this report includes crystalline silicon and thin films; the market includes 3 kW residential buildings, 100 kW commercial buildings, 500 kW industrial power stations, and 2500 kW ground power stations; the country includes France, Germany, Italy, and Spain , the United Kingdom (occupied 82% of the European photovoltaic power generation market in 2010).

PV system current and future prices Photovoltaic system prices PV system prices include: photovoltaic modules, grid-connected inverters, distribution equipment and cables, and power station construction and installation.

In 2010, PV module prices accounted for 45%-60% of the PV system price, which is the most important component of PV system price.

PV system life cycle cost PV system life cycle cost includes: operation and maintenance cost, grid-connected inverter replacement cost, land cost (for ground station only), end-of-life PV system recycling cost discount rate The cost of electricity generation is a theoretical value, which may be different from the cost of electricity generation in the actual market. In practice, investment costs are usually paid in advance. Other costs are paid during the life cycle. And the income per kilowatt-hour corresponds to the cash flow throughout the life cycle.

Therefore, all costs that are not paid in advance need to be discounted in order to meet the current value. The discount rate varies according to the type of market and country. Based on the difference in government long-term bond yields among five countries, country-specific risks have been considered. In addition, differences in the discount rates of residential photovoltaic power generation systems and other photovoltaic power generation systems are also considered.

When considering the stability of the financial environment in different countries, it does not reflect how financial institutions view the photovoltaic power generation technology today and in the future. In view of this, discount rates for individuals and investment institutions are likely to be higher. Given the rising awareness of financial institutions and the fact that photovoltaic power generation is increasingly considered low-risk investment, the return on investment of photovoltaic power generation systems may begin to decline. Based on the current level, the return on investment of residential photovoltaic power generation systems will fall from 6%-8% to 4.4%-6.1%, and that of other photovoltaic power generation systems will drop from 8%-12% to 6.5%-8.2%. . If the rate of return on investment does not fall, it indicates that the cost of photovoltaic power generation is still higher than expected, which will delay the time for photovoltaic power generation to achieve competitiveness.

Future trend of PV power system price forecast PV power system price changes depend on market changes. The report selects an intermediate scenario: from 2010 to 2015, consider the EPIA policy-driven scenario; after 2015, consider the EPIA rapid growth scenario.

PV modules: Assuming a learning rate of 20%. As the cumulative installed capacity doubles, the price of PV modules will drop by 20%. By 2020, the learning rate of thin-film PV modules is assumed to be 20%. In 2020, the learning rate of crystalline silicon PV modules is reduced to 15%.

Grid-connected inverters: The learning rate for small-scale grid-connected inverters (applied to residential PV systems) is assumed to be 20%, and the learning rate for large-scale grid-connected inverters (for other PV systems) is assumed to be 10%. .

Distribution equipment and cables: The prices of distribution equipment and cables depend on raw material prices, scale, and learning rates. But the most important factor is the efficiency of photovoltaic modules. The higher the efficiency, the lower the power distribution equipment and cable prices. The change in efficiency is based on the EPIA's roadmap.

Power station construction and installation: The parameter setting is the same as the power distribution equipment and cables. Also consider the human cost.

Calculate the electricity cost of the photovoltaic power generation calculation parameters, first calculate the generation of photovoltaic power generation system. Including several parameters:

Solar radiation: Based on the PV-GIS database.

System efficiency: The PV system cannot be 100% full. Assume that the efficiency of residential photovoltaic power generation systems is 75%, and that of large-scale systems is 80%.

Life cycle: Assume that the PV module has a life cycle of 25 years and will reach 35 years by 2020. The life cycle of grid-connected inverters ranges from 15 years in 2010 to 25 years in 2020.

Photovoltaic Module Decay Rate: Assuming based on generally accepted facts, the efficiency of a photovoltaic module after 25 years is initially 80%. After 35 years of 2020, the efficiency of photovoltaic modules will be 80% of the original.

The huge potential for a decrease in the cost of photovoltaic power PV module prices: 20% learning rate Over the past two decades, the cost of photovoltaic power generation systems has dropped significantly and is gradually approaching competitiveness. Over the past two decades, cumulative sales of photovoltaic modules have doubled, and PV module prices have dropped by 20%. In July 2011, the average price of photovoltaic modules in Europe reached 1.2 euros/watt, which was 70% lower than 10 years ago.

The price of photovoltaic power generation system can be reduced by 36%-51% by 2020

The cost of photovoltaic power generation system is mainly affected by the initial investment cost, and other costs are relatively small.

The price of photovoltaic power generation systems has rapidly declined and has fallen by 50% in Europe in the past five years. In the next 10 years, it is estimated that the price of photovoltaic power generation systems can drop by 0.83-1.59 EUR/W, which is equivalent to a decrease of 36% to 51%. In all countries and all market types, a significant drop in PV system prices is possible. Comparing the prices of several countries, Germany is the lowest, but the price gap between other countries and Germany has rapidly narrowed.

Relative to the mature German market, the prices of photovoltaic power generation systems in other European countries are higher. This is mainly because the lack of competition and policy options in smaller markets will benefit the development of more expensive photovoltaic power generation systems, while more complicated administrative and grid-connected processes will reduce the market's impact on price levels. In addition, unsustainable incentives have artificially slowed the decline in prices.

The cost of photovoltaic power generation can be reduced by 50% by 2020

The cost of photovoltaic power generation in Europe has a huge potential for decline, and it is expected to be able to drop by 50% by 2020. The parameters considered include: 2 different technologies, 5 different countries (different solar radiation, financial environment, PV system price, operation and maintenance costs) and 4 different markets.

The research is based on the assumption of a mature market that all markets behave like the German market. If some countries do not reach a mature market, the cost of photovoltaic power generation will be higher than the ideal level. The average cost of photovoltaic power generation in Europe in 2010 was 0.239 EUR/kWh, and in the first half of 2011 it was 0.203 EUR/kWh. The cost range for 2020 is about half of 2010.

The conditions of a mature market include several aspects: reduced profits, experienced installers, developers, retailer systems, fair competition among various stakeholders, transparent and effective administrative rules and grid-connected processes.

Some conclusions are that the proportion of power generation costs for all types of markets, including residential buildings, commercial buildings, industrial power stations, and ground power stations, has been relatively stable. It is expected that all market types will achieve attractive power generation costs within the next 10 years.

In addition, the higher the radiation level, the lower the power generation level. However, attractive electricity generation costs will also be realized in less sunlight in northern Europe.