Volume 17: Technology Innovation to Accelerate Energy Transitions

Policy recommendations to distributed roof PV based on economic feasibility analysis: A case study in China Jiehui Yuan, Jia Liao, Wenli Yuan, Xu Zhao, Tianduo Peng

Abstract

To realize the initiative of carbon peak and carbon neutral in China, the traditional energy system dominated by high-carbon fuels must be transformed to a clean and low-carbon energy system. Because of its resource potential and cleaner advantages, the development of distributed solar PV generation can significantly increase the supply of cleaner energy while offering the associated benefits. Distributed PV generation such distributed roof PV generation will be an important part of the new electrical power system dominated by new energy including solar and wind power. To attain this target, more distributed PV generation will need to be developed in China for the coming decades. However, the current incentives have not been sufficiently aggressive, and the distributed PV industry has been slow to develop. Existing policies for distributed PV generation thus need to be further improved. To provide effective support for decision makers in China, an economic feasibility analysis is performed in this study to explore the profitability of distributed roof PV production in a target area. The results show that the development of distributed roof PV production is not economically viable in China under the current conditions. Based on this analysis, some policy recommendations are presented to improve the current incentive polices aimed at promoting the development of distributed roof PV in China.

Keywords Carbon neutral, roof distributed PV, economic evaluation, discounted cash flow analysis, policy combinations