Solar photovoltaic panels combined with energy storage in a residential building: An economic analysis

Abstract

Renewable energy is a wide topic in environmental engineering and management science. Photovoltaic (PV) power has had great interest and growth in recent years. The energy produced by the PV system is intermittent and it depends on the weather conditions, presenting lower levels of production than other renewable resources (RESs). The economic feasibility of PV systems is linked typically to the share of self-consumption in a developed market and consequently, energy storage system (ESS) can be a solution to increase this share. This paper proposes an economic feasibility of residential lead-acid ESS combined with PV panels and the assumptions at which these systems become economically viable. The profitability analysis is conducted on the base of the Discounted Cash Flow (DCF) method and the index used is Net Present Value (NPV). The analysis evaluates several scenarios concerning a 3-kW plant located in a residential building in a PV developed market (Italy). It is determined by combinations of the following critical variables: levels of insolation, electricity purchase prices, electricity sales prices, investment costs of PV systems, specific tax deduction of PV systems, size of batteries, investment costs of ESS, lifetime of a battery, increases of self-consumption following the adoption of an ESS, and subsidies of ESS. Results show that the increase of the share of self-consumption is the main critical variable and consequently, the break-even point (BEP) analysis defines the case-studies in which the profitability is verified.