A viability index for comparing the binominal return-risk of solar radiation

E. Trincado and J.M. Vindel

Renewable Energy, 2024, vol. 220, issue C

Abstract: An insufficient amount of solar resource collected and the variability of this resource can compromise the viability of solar plant projects. For this reason, feasibility studies are usually accompanied by seasonal radiation data, which provides evidence of changes throughout the year. However, there is not a single index to quantify at the same time both elements - the amount available and the variability of the resource - which would provide a measure of the viability in a certain place to set up a solar plant. In this work, a new viability index based on the Gini coefficient (VIG) is proposed and its value is estimated for a wide region of the planet. The VIG calculates the binomial return-risk represented by the average-variance relationship. It clearly improves the results for high latitudes provided by the Sharpe index, which describes the ratio between the difference of the average return and a risk-free return and the risk in general. Finally, the article considers the storage option, drawing the value of the risk improvement index (RI) from the temporal series of the cumulated direct-normal irradiance (DNI) and an ample spectrum of constant demands. RI shows the risk improvement associated to storage of solar energy.

Keywords: Viability index based on Gini; DNI; Availability of solar resource; Variability of solar resource; Risk improvement index (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:renene:v:220:y:2024:i:c:s0960148123015355

DOI: 10.1016/j.renene.2023.119620

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