Renewable energy production support schemes for residential-scale solar photovoltaic systems in Nordic conditions

Janne Hirvonen (Corresponding Author), Genku Kayo, Sunliang Cao, Ala Hasan, Kai Sirén

Research output: Contribution to journalArticleScientificpeer-review

12 Citations (Scopus)

Abstract

The objective of this study was to examine the effect of production-based support schemes on the economic feasibility of residential-scale PV systems (1-10. kW) in Finland. This was done by calculating the payback time for various sizes of newly installed PV systems for a Finnish detached house with district heating. Three types of economic support schemes (guaranteed selling price, fixed premiums and self-consumption incentives) were tested in an hourly simulation. The load of the building was based on real-life measurements, while PV output was simulated with TRNSYS software. The energy results were post-processed with economic data in MATLAB to find the payback time. Hourly electricity prices from the Nordic energy market were used with PV system prices from Finnish companies.Unsubsidised residential PV systems in Finland had payback times of more than 40 years. The production-based support for PV generation needs to be two to three times the buying price of electricity, to make it possible to pay back the initial investment in 20 years. Low capacity systems with more than 50% self-consumption (under 3. kW) were favoured by self-consumption incentives, while high capacity systems with less than 40% self-consumption (over 5. kW) were favoured by the FIT-type support schemes.
Original languageEnglish
Pages (from-to)72-86
JournalEnergy Policy
Volume79
DOIs
Publication statusPublished - 2015
MoE publication typeA1 Journal article-refereed

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photovoltaic system
Economics
Electricity
incentive
electricity
District heating
MATLAB
energy market
Sales
software
energy production
consumption
price
Industry
economics
simulation
energy

Keywords

  • feed-in tariff
  • Finland
  • on-site energy matching
  • payback time
  • photovoltaic system
  • renewable energy support

Cite this

Hirvonen, Janne ; Kayo, Genku ; Cao, Sunliang ; Hasan, Ala ; Sirén, Kai. / Renewable energy production support schemes for residential-scale solar photovoltaic systems in Nordic conditions. In: Energy Policy. 2015 ; Vol. 79. pp. 72-86.
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title = "Renewable energy production support schemes for residential-scale solar photovoltaic systems in Nordic conditions",
abstract = "The objective of this study was to examine the effect of production-based support schemes on the economic feasibility of residential-scale PV systems (1-10. kW) in Finland. This was done by calculating the payback time for various sizes of newly installed PV systems for a Finnish detached house with district heating. Three types of economic support schemes (guaranteed selling price, fixed premiums and self-consumption incentives) were tested in an hourly simulation. The load of the building was based on real-life measurements, while PV output was simulated with TRNSYS software. The energy results were post-processed with economic data in MATLAB to find the payback time. Hourly electricity prices from the Nordic energy market were used with PV system prices from Finnish companies.Unsubsidised residential PV systems in Finland had payback times of more than 40 years. The production-based support for PV generation needs to be two to three times the buying price of electricity, to make it possible to pay back the initial investment in 20 years. Low capacity systems with more than 50{\%} self-consumption (under 3. kW) were favoured by self-consumption incentives, while high capacity systems with less than 40{\%} self-consumption (over 5. kW) were favoured by the FIT-type support schemes.",
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author = "Janne Hirvonen and Genku Kayo and Sunliang Cao and Ala Hasan and Kai Sir{\'e}n",
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Renewable energy production support schemes for residential-scale solar photovoltaic systems in Nordic conditions. / Hirvonen, Janne (Corresponding Author); Kayo, Genku; Cao, Sunliang; Hasan, Ala; Sirén, Kai.

In: Energy Policy, Vol. 79, 2015, p. 72-86.

Research output: Contribution to journalArticleScientificpeer-review

TY - JOUR

T1 - Renewable energy production support schemes for residential-scale solar photovoltaic systems in Nordic conditions

AU - Hirvonen, Janne

AU - Kayo, Genku

AU - Cao, Sunliang

AU - Hasan, Ala

AU - Sirén, Kai

N1 - Project code: 82593

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N2 - The objective of this study was to examine the effect of production-based support schemes on the economic feasibility of residential-scale PV systems (1-10. kW) in Finland. This was done by calculating the payback time for various sizes of newly installed PV systems for a Finnish detached house with district heating. Three types of economic support schemes (guaranteed selling price, fixed premiums and self-consumption incentives) were tested in an hourly simulation. The load of the building was based on real-life measurements, while PV output was simulated with TRNSYS software. The energy results were post-processed with economic data in MATLAB to find the payback time. Hourly electricity prices from the Nordic energy market were used with PV system prices from Finnish companies.Unsubsidised residential PV systems in Finland had payback times of more than 40 years. The production-based support for PV generation needs to be two to three times the buying price of electricity, to make it possible to pay back the initial investment in 20 years. Low capacity systems with more than 50% self-consumption (under 3. kW) were favoured by self-consumption incentives, while high capacity systems with less than 40% self-consumption (over 5. kW) were favoured by the FIT-type support schemes.

AB - The objective of this study was to examine the effect of production-based support schemes on the economic feasibility of residential-scale PV systems (1-10. kW) in Finland. This was done by calculating the payback time for various sizes of newly installed PV systems for a Finnish detached house with district heating. Three types of economic support schemes (guaranteed selling price, fixed premiums and self-consumption incentives) were tested in an hourly simulation. The load of the building was based on real-life measurements, while PV output was simulated with TRNSYS software. The energy results were post-processed with economic data in MATLAB to find the payback time. Hourly electricity prices from the Nordic energy market were used with PV system prices from Finnish companies.Unsubsidised residential PV systems in Finland had payback times of more than 40 years. The production-based support for PV generation needs to be two to three times the buying price of electricity, to make it possible to pay back the initial investment in 20 years. Low capacity systems with more than 50% self-consumption (under 3. kW) were favoured by self-consumption incentives, while high capacity systems with less than 40% self-consumption (over 5. kW) were favoured by the FIT-type support schemes.

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