Financial Analysis of Solar Rooftop PV System: Case Study in Indonesia

Abstract

The primary barrier to the dissemination of photovoltaic (PV) technology is its high cost as compared to other alternative options. This paper discusses some financial aspects of rooftop PV systems: module cost, BOS cost, useful lifetime, minimum attractive rate of return, and O&M cost. An equation and numerical calculation were made for estimating the unit cost of electricity of a rooftop system. The numerical calculation and simulation were made by taking the condition of Indonesia as the case study. It was assumed that (i) the useful lifetime of the PV system is 20 years, (ii) the annual maintenance cost is 2% of the total capital cost of the system, (iii) taxes and insurance costs are not to be paid, and (iv) capacity utilization is 20%. It is found that rooftop PV systems have the potential to provide power at competitive prices for residential with other alternative options for power generation.