Thursday, January 28, 2016

Cost of BIPV (1)


There was an interesting story in One Step Off The Grid this week about a PV installation at 101 Collins St, in the heart of Melbourne’s CBD.  This building is a 56 storey skyscraper and the 180 330 W PV panels are mounted vertically on the roof of the building at a height of 195 m.  The roof space is minimal, hence the vertical installation, and hence I’m going to classify this as Building Integrated Photovoltaics, BIPV.

The power from the installation will be used to offset the electricity demand of the building’s cooling system, so this is a behind-the-meter application.

The specifications of the installation are clearly stated in the article mentioned above.  The peak output of the system is 59.4 kW (I’m presuming at grid AC), the annual output will be 47 MWh, which is said to offset 59 tonnes of CO2 emissions per year.  (I’ll mention that most of Melbourne’s electricity supply is powered by brown coal, which has horrendous CO2 emissions.  In this case the data suggests, 59/47 t =1.26 t CO2 per MWh.)  The cost of the installation is stated as AUD 230,000.

The Capacity Factor of the installation is 47,000/(59.4×365×24) = 0.09, which is the lowest value I have recorded in all my studies.  The poor CF results from a combination of the vertical installation and Melbourne’s climate (not that I wish to offend my Melbourne friends).

Let me now estimate the LCOE using my standard assumptions:
  • there is no inflation,taxation implications are neglected,
  • projects are funded entirely by debt,
  • all projects have the same interest rate (8%) and payback period (25 years), which means that the required rate of capital return is 9.4%,
  • all projects have the same annual maintenance and operating costs (2% of the total project cost), and
  • government subsidies are neglected.
For further commentary on my LCOE methodology, see posts on Real cost of coal-fired power, LEC – the accountant’s view, Cost of solar power (10) and (especially) Yet more on LEC.

Note that I am now using annual maintenance costs of 2% of capital cost rather than 3% as in posts during 2011.

The results for the 101 Collins St installation are as follows:
Cost per peak Watt              AUD 3.87/Wp
LCOE                                     AUD 558/MWh

The components of the LCOE are:
Capital           {0.094 × 230,000}/{47 MWh} = AUD 460/MWh
O&M              {0.020 × 230,000}/{47 MWh} = AUD 98/MWh

Conclusion

At AUD 558 per MWh, the LCOE for this project is about 4 times that of utility-scale PV projects I have analysed recently.  For comparisons, I refer you to my LCOE graphic.

As mentioned, I’m going to classify this as BIPV.  The results are completely unrepresentative of the LCOE for best practice PV installations around the world.