Economic Assessment of a PV-HP System for Drying Alfalfa in The North of Spain

Antonio Quijano, Celena Lorenzo and Luis Narvarte ()
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Antonio Quijano: Instituto de Energía Solar, Universidad Politécnica de Madrid, 28031 Madrid, Spain
Celena Lorenzo: Instituto de Energía Solar, Universidad Politécnica de Madrid, 28031 Madrid, Spain
Luis Narvarte: Instituto de Energía Solar, Universidad Politécnica de Madrid, 28031 Madrid, Spain

Energies, 2023, vol. 16, issue 8, 1-19

Abstract: This paper presents an economic assessment of three drying systems (DS) with different configurations: diesel-powered (DDS), grid-powered (GDS), and photovoltaic-powered (PVDS). The third configuration, PVDS, presents important technological innovations regarding the electric configuration (stand-alone PV, without batteries or grid support) and the heat pump technology used (optimized for drying the recirculated air, which permits a reduction in the electricity consumption by more than 45% if compared to a diesel air-heater or an electric resistance). The profitability of the investment required for the installation of the three systems is proven by calculating the profitability index ( PI ), the internal rate of return ( IRR ), the payback period ( PBP ), and the levelized cost of energy ( LCOE ). All the indicators show good profitabilities for the three technologies (the PI values range from 6.78 to 10.11, the IRR values range from 24% to 37%, and the PBPs are between 3 and 4 years), but the PVDS clearly offers important economic advantages: its PI and IRR are more than 40% higher, the PBP is 25% shorter, and the LCOE is between 40 and 47% lower than for the two other systems. The results of this analysis correspond to a particular base case but are obviously sensitive to geopolitical and economic changes: the ultimate strength of the PVDS configuration is its resilience against a possible rise in electricity and diesel prices, reducing the uncertainty for investors and policymakers.

Keywords: heat pumps; photovoltaic; drying; economic assessment (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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