Photovoltaics as a terrestrial energy source. Volume 2: System value

Abstract

Assumptions and techniques employed by the electric utility industry and other electricity planners to make estimates of the future value of photovoltaic (PV) systems interconnected with U.S. electric utilities were examined. Existing estimates of PV value and their interpretation and limitations are discussed. PV value is defined as the marginal private savings accruing to potential PV owners. For utility-owned PV systems, these values are shown to be the after-tax savings in conventional fuel and capacity displaced by the PV output. For non-utility-owned (distributed) systems, the utility's savings in fuel and capacity must first be translated through the electric rate structure (prices) to the potential PV system owner. Base-case estimates of the average value of PV systems to U.S. utilities are presented. The relationship of these results to the PV Program price goals and current energy policy is discussed; the usefulness of PV output quantity goals is also reviewed