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PHOTOVOLTAICs - ECONOMICS

COST of ELECTRICITY from PV Systems

The indicative cost of electricity produced by a PV system may be obtained by the formula:

P = (C*r /n +m) / E

Where:

  • P = Energy cost ( € /kWh)
  • C = Total initial capital cost of the PV system ( € )
  • r = Cumulative value factor taking into account the discount rate (6%) and the possibility of subsidies for PV panels
  • n = Life of the investment = life of the PV system ( y )
  • m = Operation & maintenance costs (€ / y)
  • E = Annual energy yield ( kWh/y ) = RP*OH
  • RP = Rated power of the PV system (kW)
  • OH = Operating hours of the system (hours/y)

You can introduce your own data in the following table:

definition symbol
value
 suggested value unit
Total initial capital cost TC   €
Rated power of the PV system RP   W
Life of investment n 25 y
Specific operating & maintenance costs OM 0.02 €/kWh*y
Operating hours of the system OH 1200 hours/y
Annual operating & maintenance costs m   €/y
Cumulative value factor r 1.9  
     
Specific capital cost C   €/W
Annual energy yield E   kWh/y
Energy cost P   € / kWh

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