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Manuscript ID : IMJ-2101-1533 (R1) Visit : 127 Page: 66 - 87

10.30495/imj.2021.683603

Article Type: Original Research

An analysis of the cost index of renewable energy production in Iran ‎(Case study: home scale photovoltaic power plant)‎

Subject Areas : Industrial Management

Shirin Azizi 1 ( Azad univercity- science & research branch )
Reza Radfar 2 ( Technology Management, Faculty of Management and Economy, Azad University of Science and Research, Tehran, Iran )
Hanieh Nikomaram 3 ( Islamic Azad University Science and Research Branch - Department of Environment )
Ali Rajabzadeh 4 ( مدیرگروه مدیریت صنعتی دانشگاه تربیت مدرس )

Received: 2021-01-12 Accepted : 2021-05-18 Published : 2021-08-02

Keywords: levelized cost of electricity (LCOE), solar photovoltaic (PV) costs, Renewable Energy, ‎ sensitivity analysis,

Abstract :

Renewable energy plays significant role in achieving energy savings and emissions reduction. As a ‎sustainable and environmental friendly renewable energy source, solar photovoltaic (PV) is of ‎interest for research and development. However, the cost of PV generation and determining FIT ‎based on it is a factor hampering the commercialization of this emerging industry. This paper uses a ‎mathematical model of the levelized cost of energy (LCOE) to calculate the power generation cost ‎of PV projects on the basis of lifetime cost structure analysis. The minimum amount of guaranteed electricity purchase is calculated by it.A sensitivity analysis is conducted to ‎examine the impact of different variables on the LCOE of PV projects. The results of sensitivity ‎analysis showed that the capacity factor is the most influential variable in determining the LCOE ‎value. This research provides support for government to formulate incentive policies for the ‎industry And thus offers the development of the use of renewable energy.

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_||_

  1. Ahmad, S., Tahar, R. M., Muhammad-Sukki, F., Munir, A. B., & Rahim, R. A. (2015). Role of feed-in tariff policy in promoting solar photovoltaic investments in Malaysia:a system dynamics approach. Energy, 808-815.
    2.
  2. Al-Maamary, H., Kazem, H., & Chaichan, M. (2017). enewable energy and GCC States energy challenges in the 21st century: A review. International Journal of Computation and Applied Sciences, 2(1), 11-18.
    3.
  3. Bakhshi, R., & Sadeh, J. (2018). Economic evaluation of grid connected photovoltaic systems viability under a new dynamic feed–in tariff scheme: A case study in Iran. Renewable Energy, 119, 354-364. doi:10.1016/j.renene.2017.11.093
    4.
  4. Bakhshi, R., & Sadeh, J. (2018). Economic evaluation of grid–connected photovoltaic systems viability under a new dynamic feed–in tariff scheme: A case study in Iran. Renewable energy, 119, 354-364.
    5.
  5. Bakhshi, R; Sadeh, J. (2018). Economic evaluation of grid–connected photovoltaic systems viability under a new dynamic feed–in tariff scheme: A case study in Iran. Renewable energy, 119, 354-364. doi:10.1016/j.renene.2017.11.093
    6.
  6. Beck, A. L., & Rai, V. (2020). Solar Soft Cost Ontology: A Review of Solar Soft Costs. Prog.Energy, 2(1).
    7.
  7. Bilgili, M., Ozbek, A., Sahin, B., & Kahraman, A. (2015). An overview of renewable electric power capacity and progress in new technologies in the world. Renewable and Sustainable Energy Reviews, 323-334. doi:10.1016/j.rser.2015.04.148
    8.
  8. Borgonovo, E., & Plischke, E. (2016). Sensitivity analysis: a review of recent advances. European Journal of Operational Research, 248(3), 869-887.
    9.
  9. Chung, D., Davidson, C., Fu, R., Ardani, K., & Margolis, R. (2015). US photovoltaic prices and cost breakdowns. Q1 2015 benchmarks for residential, commercial, and utility-scale systems. National Renewable Energy Lab.(NREL).
    10.
  10. Congress, U. (2020). Further Consolidated Appropriations Act.
    11.
  11. EIA, U. (2016). Capital Cost Estimates for Utility Scale Electricity Generating Plants. Washington, DC, USA: US Department of Energy Information Administration.
    12.
  12. Elia, A., Kamidelivand, M., Rogan, F., & Gallachóir, B. Ó. (2021). Impacts of innovation on renewable energy technology cost reductions. Renewable and Sustainable Energy Reviews, 1-31. doi:https://doi.org/10.1016/j.rser.2020.110488
    13.
  13. Energy, U. D. (2020). Goals of the Solar Technologies Office.
    14.
  14. Freyman, T., & Tran, T. (2019). Renewable Energy Discount Rate Survey Results. Grant Thornton UK LLP.
    15.
  15. Fu, R. F., & Margolis, R. (2018). U.S. Solar Photovoltaic System Cost Benchmark: Q1. National Renewable Energy Laboratory.
    16.
  16. Fu, R; Feldman, D. J; Margolis, R. M. (2018). US solar photovoltaic system cost benchmark: Q1. National Renewable Energy Lab.(NREL).
    17.
  17. Geissmann, T., & Ponta, O. (2017). A probabilistic approach to the computation of the levelized cost of electricity. Energy, 124, 372-381. doi:10.1016/j.energy.2017.02.078
    18.
  18. Hernández Moro, J., & Martínez Duart, J. M. (2012). CSP electricity cost evolution and grid parities based on the IEA roadmaps. Energy policy, 41, 184-192.
    19.
  19. Hernández-Moro, J., & Martínez-Duart, J. (2013). Analytical model for solar PV and CSP electricity costs: Present LCOE values and their future evolution. Renew. Sustain. Energy Rev, 119–132.
    20.
  20. Information, U. E. (2020). Levelized Cost and Levelized Avoided Cost of New Generation Resources in the Annual Energy Outlook 2020.
    21.
  21. IRENA. (2019). Renewable Cost Database.
    22.
  22. IRENA. (2020). Renewable Power Generation Costs in 2019.
    23.
  23. Lai, C. S., & McCulloch, M. D. (2017). Levelized cost of electricity for solar photovoltaic and electrical energy storage. Applied energy, 190, 191-203.
    24.
  24. Liang, X. (2017). Emerging power quality challenges due to integration of renewable energy sources. 53(2), 855-866.
    25.
  25. Limmanee, A., Songtrai, S., Udomdachanut, N., Kaewniyompanit, S., Sato, Y., Nakaishi, M., & Sakamoto, Y. (2017). Degradation analysis of photovoltaic modules under tropical climatic conditions and its impacts on LCOE. 102, 199-204. doi:10.1016/j.renene.2016.10.052
    26.
  26. Marks-Bielska, R., Bielski, S., Pik, K., & Kurowska, K. (2020). energies, 2-23. doi:10.3390/en13184624
    27.
  27. Mohammadi, K., Naderi, M., & Saghafifar, M. (2018). Economic feasibility of developing grid-connected photovoltaic plants in the southern coast of Iran. 156, 17-31. doi:10.1016/j.energy.2018.05.065
    28.
  28. Mousavian, H. M., Shakouri, G. H., Mashayekhi, A. N., & Kazemi, A. (2020). Does the short-term boost of renewable energies guarantee their stable long-term growth? Assessment of the dynamics of feed-in tariff policy. Renewable Energy, 159, 1252e1268. doi:10.1016/j.renene.2020.06.068
    29.
  29. National Renewable Energy Laboratory. (2020). CREST: Cost of Renewable Energy Spreadsheet. Retrieved from https://www.nrel.gov/analysis/crest.html.
    30.
  30. National Renewable Energy Laboratory. (2020). System Advisor Model. Retrieved from https://sam.nrel.gov/
    31.
  31. NREL. (2019). Levelized Cost of Energy (LCOE).
    32.
  32. Parrado, C., Marzo, A., Fuentealba, E., & Fernández, A. (2016). 2050 LCOE improvement using new molten salts for. Renew. Sustain. Energy Rev, 57, 505–514.
    33.
  33. Rosales-Calderon, O. &. (2019). A review on commercial-scale high-value products that can be produced alongside cellulosic ethanol. Biotechnology for biofuels, 12(1), 1-58.
    34.
  34. Shen, W., Chen, X., Qiu, J., Hayward, J. A., Sayeef, S., Osman, P., & Dong, Z. Y. (2020). A comprehensive review of variable renewable energy levelized cost of electricity. Renewable and Sustainable Energy Reviews, 133.
    35.
  35. Short, W., Packey, D. J., & Holt, T. (1995). A Manual for the Economic Evaluation of Energy Efficiency and Renewable Energy Technologies. National Renewable Energy Laboratory.
    36.
  36. Syal, S. M., & MacDonald, E. F. (2020). Quantifying the Importance of Solar Soft Costs: A New Method to Apply Sensitivity Analysis to a Value Function. ASME Journal of Mechanical Design, 142(12).
    37.
  37. Tabatabaei, S. M., Hadian, E., Marzban, H., & Zibaei, M. (2017). Economic, welfare and environmental impact of feed-in tariff policy: A case study in Iran. Energy Policy, 102, 164-169.
    38.
  38. Tran, T. T., & Smith, A. D. (2017). Evaluation of renewable energy technologies and their potential for technical integration and cost-effective use within the US energy sector. Renewable and Sustainable Energy Reviews, 1372-1388. doi:10.1016/j.rser.2017.05.228
    39.
  39. Tran, T. T., & Smith, A. D. (2018). Incorporating performance-based global sensitivity and uncertainty analysis into LCOE calculations for emerging renewable energy technologies. Applied energy, 216, 157-171.
    40.
  40. WHO. (2019). Household air pollution and health. World Health Organization. Retrieved from https://www.who.int/news-room/fact-sheets/detail/household-air-pollution-and-health
    41.
  41. World economic outlook. (2020). Inflation rate, average consumer prices. Retrieved from International Monetary Fund: http://www.imf.org/external/
    42.
  42. Yu Zhao, Z., Long Chen, Y., & Thomson Douglas, J. (2017). A comprehensive review of variable renewable energy levelized cost of electricity. Renewable and Sustainable Energy Reviews, 120, 117-127. doi:10.1016/j.energy.2016.12.122
    43.
  43. Zawalińska, K., Kinnunen, J., Gradziuk, P., & Celińska-Janowicz, D. (2020). To Whom Should We Grant a Power Plant? Economic Effects of Investment in Nuclear Energy in Poland. Energies, 13(11).
    44.
  44. Zhai, R., Hu, J., & Saddler, J. (2016). What are the major components in steam pretreated lignocellulosic biomass that. Energy, 3429–3436.
    45.
  45. Zhuang, X., Xu, X., Liu, W., & Xu, W. (2019). LCOE Analysis of Tower Concentrating Solar Power Plants Using Different Molten-Salts for Thermal Energy Storage in China. 12(7). doi:10.3390/en12071394
    46.

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