Assessing Economic Constraints and Cost-Benefit Analysis Framework of Solar Parks and Energy Storage Infrastructures

Nikolaos Kalyviotis, Alfredo Cartone, André Carrascal-Incera and Giorgos Stamatopoulos

MPRA Paper from University Library of Munich, Germany

Abstract: The global shift to a low-carbon energy system highlights the need for large-scale renewable deployment. Solar photovoltaics, with their modularity and falling costs, play a central role but also pose challenges due to intermittency. The “duck curve”—midday overgeneration followed by steep evening demand peaks—exemplifies these issues and calls for flexible infrastructure such as battery energy storage systems (BESS). This paper examines the techno-economic optimization of solar-BESS projects in Greece, which targets 82% renewable electricity by 2030 and full neutrality by 2050. Using cost-benefit analysis, the study assesses storage’s role in markets, grid balancing, and residual load management, based on projections from Greece’s National Energy and Climate Plan and Long-term Strategy. The methodology combines system-level simulations with market modelling to estimate storage needs and revenues from arbitrage, ancillary services, and capacity mechanisms. Results show that storage enhances solar value by reducing curtailments and enabling peak-time participation, but oversized capacity quickly reaches diminishing returns due to residual load and price dynamics. Optimal sizing is thus key for economic efficiency and system stability. The study recommends dynamic incentives that reflect the real-time value of storage and warns against uniform subsidies. Finally, it offers a structured framework for designing profitable solar-storage projects.

Keywords: enewable Energy; Economics & Finance; Cost-benefit analysis; Solar energy; Energy storage. (search for similar items in EconPapers)
JEL-codes: Q41 (search for similar items in EconPapers)
Date: 2025-08-26
References: Add references at CitEc
Citations:

Downloads: (external link)
https://mpra.ub.uni-muenchen.de/128660/1/MPRA_paper_128660.pdf original version (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:128660

Access Statistics for this paper

More papers in MPRA Paper from University Library of Munich, Germany Ludwigstraße 33, D-80539 Munich, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Joachim Winter ().