Solar PV Systems

Economics of Solar Photovoltaic Systems

Solar Electric Investment Analysis 

New Extension Circular detailing how to evaluate solar electric systems for their economic performance.  

1. Determine if you have a viable site (facing south with little shade).
2. Determine the total installed cost of a system from your local solar installer.
     Work with the installer to estimate annual production from solar array.
3. Determine your cost of electricity (check your most recent electricity bill). Check state net metering laws. 
     Check your local utility’s net metering policy (in some cases local utilities have a more generous policy than state law).
4. Calculate simple payback.
5. Determine eligibility for local, state, and federal grants and tax credits.
6. Calculate payback with incentives.
7. Include inflation estimate in your calculations.
8. Calculate internal rate of return and net present value using a spreadsheet or an online calculator.

Solar Photovoltaic Systems

The complete solar system is called a Solar Photovoltaic (PV) System and is also called a solar array or simply a solar system. A solar system is an array of solar panels that have been wired together to produce the correct amount of voltage. Each solar panel is made up of solar cells, and each solar cell is made from silicon. Silicon is a chemical element that acts as a semiconductor allowing sunlight to produce freely flowing electrons for electricity.

A solar panel is made up entirely of the same type of solar cells and this determines the efficiency rating of the panel. Once the panels are wired together they are considered an array.


Solar Mounting Systems

 Another important aspect of a solar array is its mounting system. The mounting system plays an important role as it attaches the solar panels to their base, be it a roof, the ground, or a wall. The four common types of mounting systems are roof mount, pole mount, ground mount, and bracket mounting systems. The type of mounting system is usually chosen based on such factors as weather, site shading, base material, and orientation of the array.


Solar Cells 

There are three main types of solar cells: monocrystalline, polycrystalline, and thin-film solar cells. Monocrystalline cells are made from a single large crystal of silicon, polycrystalline cells are made from an ingot made up of many smaller silicon crystals, and thin-film cells are made by transferring a thin film of silicon onto a steel sheet. Monocrystalline cells are traditionally most efficient while thin-film cells are least efficient, on average.