Excessive rates of interest and excessive capex will convey the common payback time for photo voltaic in Germany, Spain and Italy to nearly 20 years by 2022, in response to a brand new report by SolarPower Europe (SPE) and Vitality Brainpool. pv journal just lately spoke with SPE Market Analyst Christophe Lits to crunch the numbers.
SolarPower Europe has included an evaluation of residential PV payback occasions in 2022 in a just lately revealed report on the symbiotic impact of rooftop photo voltaic and warmth pumps.
The power modelling, carried out by the German-based consultancy Vitality Brainpool, considers three totally different eventualities. It examines a “fossil dumping” situation, during which international gasoline demand drops dramatically, resulting in decrease fossil gas costs. It appears to be like at a “new regular” situation, the place gasoline costs stay at present ranges. And it additionally appears to be like at a “return to the disaster” situation, the place gasoline costs return to excessive costs within the fall of 2021. Residential PV techniques are assumed to have capacities of 8 kW in Germany and seven kW in Spain and Italy.
The mannequin reveals PV payback occasions of about 18 years in Germany, 19 in Spain, and 14 in Italy, below the “new regular” situation. The “fossil dumping” situation reveals payback intervals of 20 years, 25 years, and 17 years, respectively. Rooftop photo voltaic has the bottom payback time below the “return to disaster” situation, at 17 years in Germany, 12 years in Italy, and 11 years in Spain.
“We have been stunned by the outcomes for the payback intervals, as a result of we frequently hear that the payback time is decrease than 10 years,” mentioned Christophe Lits, market analyst at SolarPower Europe. pv journal. “The mannequin takes into consideration all the pieces till 2022: the capex worth, electrical energy worth, rates of interest, feed-in tariffs, rebate schemes … the [PV system and its] set up, and a few electrical energy from the grid that you just needn’t purchase. Then we simply take a look at what number of years of financial savings it takes to equal the overall price of capex.
Three main elements are at play within the lengthy payback intervals for PV in 2022, in response to Liets: excessive capex, estimated at €1,600 ($1,742)/kW excluding added tax, low worth of electrical energy within the years after 2022, and excessive rates of interest for utility loans to buy PV techniques.
“After we speak to installers about payback occasions, they do not actually take a look at all of the variations in subsidies or capex worth will increase, they take a look at how a lot electrical energy it can save you by -installation of PV – in case you look in additional element, the outcomes are extra correct,” mentioned Liets, referring to the big distinction between the usually proposed 10-year payback interval and the outcomes of the evaluation .
Following the publication of the report, SolarPower Europe and Vitality Brainpool additionally carried out a sensitivity evaluation of payback occasions with totally different capex quantities.
“For the capex values seen 4 to 2 years in the past, within the vary of €1,200/kW and even €1,000/kW in Spain, the payback occasions might be round 10 years in Germany and 7 in Spain ,” mentioned Liets.
The report concludes that capex help is important to scale back reimbursement occasions “in an inflationary setting with excessive rates of interest and excessive labor prices.” It proposes a number of methods for member states to offer capex help, noting that 30% of capex help will scale back payback occasions for PV and warmth pumps by six to eight years in Germany, Italy, and Spain.
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