Financial analysis of residential PV and solar water heating systems in the U.S.
Richter, John (2008) Financial analysis of residential PV and solar water heating systems in the U.S. Masters by Coursework thesis, Murdoch University.
Renewable energy technologies (including solar) have enjoyed a period of rapid growth in recent years, largely due to government subsidies of various kinds. But renewable energy technologies cannot expect to replace fossil fuels on the back of the taxpayers or ratepayers; they will have to become price competitive. Most studies on the economics of renewable energy systems fail to consider one of the most powerful trends in their favor: the rising cost of fossil fuels. This study provides an economic analysis of residential solar systems (photovoltaic and water heating) in Michigan and Hawaii. It shows that residential grid-intertied PV systems are not currently economically attractive in Michigan under any likely assumptions, while higher utility rates and greater solar radiation in Hawaii make a PV system a reasonable investment on economics alone – without government subsidies. Solar water heating systems are very financially attractive in Hawaii and somewhat attractive in Michigan, depending on assumptions about the future rate of utility price escalations. In either location, without government assistance, solar water heaters are more financially attractive than PV systems. Finally, this study examines the effect of using the optional time-of-day tariff offered by one of the major utilities (DTE) and surprisingly finds that the TOD rate structure puts a lower value on the output of either system than the standard flat-rate tariff.
|Publication Type:||Thesis (Masters by Coursework)|
|Murdoch Affiliation:||School of Engineering and Energy|
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