Economic feasibility of floating photovoltaic power plants: Profitability and competitiveness

Leonardo Micheli and Diego L. Talavera

Renewable Energy, 2023, vol. 211, issue C, 607-616

Abstract: Floating photovoltaics is a solution that is getting significant attention worldwide. It consists of installing photovoltaic modules on water basins. This contributes to alleviating the land occupancy issue associated with the growing deployment of photovoltaics. However, because of the early stage of deployment, the costs of floating systems are still higher than traditional land-based photovoltaics. Nonetheless, in some cases, the installation of floating photovoltaics might occur independently of the cost competition with the in-land technology. In this light, the current work presents an analysis of the profitability and cost competitiveness of floating photovoltaics in Europe. The Levelized Cost of Electricity of floating photovoltaics is found to be generally higher than onshore wind and land-based photovoltaics, but lower than fossil gas. Furthermore, floating photovoltaics is found to be a profitable investment in countries with low capital costs, high energy yields and/or high market price of electricity. In these countries, the internal rate of return is typically higher than the weighted average cost of capital, confirming the profitability of the investigated solution. Last, the economic parameters are found to influence the economic viability of FPV more than the energy related factors such as the tilt angle or the heat transfer.

Keywords: Floating photovoltaics; Economic analysis; Levelized cost of electricity; Net present value; Internal rate of return (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:renene:v:211:y:2023:i:c:p:607-616

DOI: 10.1016/j.renene.2023.05.011

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