21
Cost Analysis of Solar Photovoltaics
(e.g. flat membrane, sloped metal) and ground-mounted
systems. Because of their low value and substantial
weight, mounting and racking structures are generally
produced and/or assembled locally, as shipping would
be prohibitively expensive, except from countries
where labour costs are so low that they can oset
transportation costs.
Combiner box and miscellaneous electrical components
include all remaining installation components, including
combiner boxes, wires/conductors, conduits, data
monitoring systems, and other miscellaneous hardware.
Combiner boxes are the only PV system-specific product
included in this category and they are sourced from
dedicated manufacturers who supply pre-engineered
systems. Other miscellaneous electrical hardware (e.g.
wires, electrical conduits, overcurrent protection) are
commodity products and can be sourced virtually
anywhere.
Site preparation and system installation are major
components of the BOS and installation costs. They
include site preparation (roof or ground-based),
any physical construction works (e.g. electrical
infrastructure), installation and connection of the system.
Labour costs make up the majority of the installation
costs, and vary by project and country.
System design, management and administrative costs
include system design, legal, permitting, financing and
project management costs. For residential and small-
scale PV systems, these costs are typically included in
the total PV installed prices quoted by companies. For
large-scale installations these costs might be managed
directly by the promoter or sub-contracted to a service
provider. When PV system costs are quoted in literature,
these costs are typically included in overhead costs and
profit margins. These soft costs depend significantly
on local conditions. In the United States (2010), they
accounted for an average 37% of total system costs (GTM
Research, 2011).
Electricity storage systems for o-grid PV systems
enable electricity use at night or during cloudy periods.
A variety of electricity storage systems exist, or are under
development, but they are expensive and tend to be
more suited to large-scale applications. For small-scale
systems, standard lead-acid batteries are the technology
of choice. Redox flow batteries represent an emerging
option, but these are not yet commercially available.
Capacitors are another emerging technology, but are
more suited to very short-term electricity storage.
Batteries increase the cost of the PV system, but much
less than grid connection in remote areas. They are
needed not only for remote residential and commercial
applications, but also for o-grid repeater stations for
mobile phones, radio beacons, etc.
Lead-acid batteries are the oldest, most widely applied
electricity storage technology and are a proven option.
Car or truck batteries are sometimes used because they
are the cheapest option, but they are not designed for
use with power generation technologies and have a short
lifespan (as low as 50 cycles). Deep-cycle, lead-acid
batteries are a proven option, with much longer lifespans
than car batteries. However, even deep-cycle batteries
will last longer if the discharge rate is kept low. For
instance, limiting the discharge to 20% or less can allow
the battery to last for ten years. The trade-o is higher
initial costs, as 5 kWh of battery storage is needed for
every 1 kWh of electricity used from storage.
In sunny African conditions a 1 kW PV system may supply
1 500 kWh per year (4 kWh/day). Assuming half of this
energy is needed in the evenings, this means 2 kWh of
useful storage is needed, requiring 10 kWh of battery
storage if battery life is to be optimised. This represents
an investment of USD 1 500 (USD 150/kWh), to which
a battery charge controller must be added if this is not
included in the PV system. The addition of storage,
assuming the PV system costs around USD 3 000/kW,
therefore adds 50% to the PV system cost (total USD 4
500/kW).
Other battery options include lithium-ion (Li-ion) or
sodium-sulphur (NAS) batteries. Their cost, at USD 550
to USD 600/kWh, is higher than for deep-cycle, lead-acid
batteries. However, NAS is a new battery technology and
global production capacity is less than 150 MW per year,
so cost reductions are likely. NAS batteries are currently
large-scale storage solutions, with a single NAS battery
being in the several MW capacity range (the battery
will weigh ten tonnes, or more). Production of smaller
scale NAS batteries is just starting. NAS batteries could
therefore be used for a mini-grid, village or small city
size storage solutions. In the longer-term, NAS battery
costs could come down significantly, as they have
been designed to use cheap and abundant materials.
Li-ion batteries are small-scale, often powering laptop