Abstract:
As the solar photovoltaic (PV) matures, the economic feasibility of PV projects is
increasingly being evaluated using the levelized cost of electricity (LCOE) generation in
order to be compared to other electricity generation technologies. Unfortunately, there is
lack of clarity of reporting assumptions, justifications and degree of completeness in
LCOE calculations, which produces widely varying and contradictory results. This paper
reviews the LCOE for solar PV, correcting the misconceptions made in the assumptions
found throughout the literature. Then a template is provided for better reporting of LCOE
results for PV needed to influence policy mandates or make invest decisions. A numerical
example is provided with variable ranges to test sensitivity, allowing for conclusions to
be drawn on the most important variables. Grid parity is considered when the LCOE of
solar PV is comparable with grid electrical prices of conventional technologies and is the
industry target for cost-effectiveness. Given the state of the art in the technology and
preferable financing terms it is clear that PV has already obtained grid parity in specific
locations and as installed costs continues to decline, grid electricity prices continue to
escalate, and industry experience increases, PV will become an increasingly
economically advantageous source of electricity over expanding geographical regions.
Description:
This thesis submitted in partial fulfillment of the requirements for the degree of Bachelor of Science in Electronics and Telecommunication Engineering of East West University, Dhaka, Bangladesh
