Page 29 - European Energy Innovation - Winter 2016 publication
P. 29

Winter 2016 European Energy Innovation  29


Costs and Economics
of Electricity from Residential PV
Systems in Europe

By Arnulf Jäger-Waldau (pictured), European Commission, Joint Research Centre,
Renewables and Energy Efficiency Unit

Over the last decade,                      There are in principle two methods,
                  prices for residential   to increase the direct consumption
                  grid-connected PV        (“Self-Consumption”) of solar electricity.
                  systems have decreased   One is to use intelligent control
significantly, as shown in Fig. 1. The     systems, which switch major loads
increase in PV system prices in Japan,     (washing/dryer machines, heat pumps,
between 2007 and 2010 as well as the       refrigerators, air-conditioners) on
increase from 2015 to 2016, are due to     when the sun is shining. The second
changes in exchange rates; in the local    one requires a means to store the
currency the prices fell further.          energy, either as electricity which
                                           requires accumulators, or as “product”,
In September 2016, the worldwide           (heatstorage, cold-storage or pumped
average price of a residential system      water), for use at night or rainy days.
without tax was given as USD 1.67/         Storing electricity has the additional
Wp (EUR 1.49/Wp) about 25 % higher         advantage of making energy offers
than in Europe with EUR 1.21/Wp or         to the network operator at times the
Australia1. T aking the European price     operators chooses as being profitable.
and adding a surcharge of EUR 0.14/
Wp for fees, permits, insurance, etc., an  Nevertheless, some fraction of the
installed PV system costs EUR 1 350/       electricity generated has to be sold
kWp without financing2 and VAT. The        to the grid. The question is what kind
influence of the European VAT rates on     of pricing should be used – contract,
investment costs and LCOE are shown        wholesale or day-ahead prices. The
in the European Cost Maps3.                fact that the costs of PV-generated

As shown in a growing number of            Fig. 1: Residential PV system price development over the last decade (data sources:
countries, electricity production          IEA PVPS, BSW, DoE SunShot Initiative, Eurostat, OECD key economic data)
from residential PV solar systems
can be cheaper than the variable           Residential	PV	system	Price	[EUR2016/Wp]€12.00                                         Germany
part of residential electricity prices,                                            €10.00                                         Japan
depending on the actual electricity                                                                                               USA
price and the local solar radiation
level. Therefore, using self-generated                                               €8.00
electricity provides a means to lower
the electricity bill on one hand, and                                                €6.00
to avoid excessive penetration of
PV generated electricity in the grid                                                 €4.00
network. In the case of a PV system
size that generates as much electricity                                              €2.00
as the customer uses over a year, the
actual consumption during the time                                                   €0.00          2002  2004  2006  2008  2010  2012     2014         2016
of generation is in general about 25%-                                                        2000
30% on residences, in commercial                                                                                      Year
buildings it can be more4,5.
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