A European Assessment of the Solar Energy Cost: Key Factors and Optimal Technology

Daniel Lugo-Laguna, Angel Arcos-Vargas and Fernando Nuñez-Hernandez
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Daniel Lugo-Laguna: Industrial Engineering and Management Science, Universidad de Sevilla, 41004 Sevilla, Spain
Angel Arcos-Vargas: Industrial Engineering and Management Science, Universidad de Sevilla, 41004 Sevilla, Spain
Fernando Nuñez-Hernandez: Industrial Engineering and Management Science, Universidad de Sevilla, 41004 Sevilla, Spain
Authors registered in the RePEc Author Service: Fernando Núñez Hernández

Sustainability, 2021, vol. 13, issue 6, 1-25

Abstract: Solar energy has become one of the most important sources of energy all around the world. Only in the European Union, between 2010 and 2019, solar photovoltaic (PV) electricity generation capacity increased from 1.9 to over 133 GW. Throughout this work, an economic analysis of the production of photovoltaic solar energy utility scale facilities is performed, previously defining some theoretical concepts relating to electricity generation by means of photovoltaic modules, as well as commenting on studies that have inspired the project. In order to carry out this economic analysis, the locations of twenty capital cities within European Union countries are selected, in order to estimate their yearly solar PV energy produced under specific conditions. The Levelized Costs of Energy (LCOE) is calculated with the goal of comparing the profitability of each photovoltaic tracking technology: fixed, one-axis tracking systems (vertical or inclined) and two-axis tracking systems; including LCOE maps country-wise for each technology. A sensitivity analysis is also presented, in order to evaluate the significance and impact of the main variables involved in the analysis. The results show that one-axis tracking systems are the best option in all countries, reducing LCOE by more than 20% when compared to two-axis tracking system. The impact of wages is also significant. In higher latitudes, in most cases, wages also increase, hence the LCOE is higher and consequently less interesting for a potential investor.

Keywords: solar power; levelized costs of energy; economic assessment; european countries; PVGIS; photovoltaic energy; econometric model (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

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