Based on your inputs in Step 1, some key economic figures for your project are shown below. The main calculation results are displayed in the right box. In order to adjust the calculations to your individual case you need to answer some further key questions by adjusting the sliders below each chart. Your adjustments will directly influence the economic results in the box on the right.
The Levelized Cost of Electricity (LCOE) is an economic assessment of the total cost to build and operate a power-generating asset over its lifetime divided by the total energy output of the asset over that lifetime.
The duration required for an investment to recover its initial outlay in terms of profits or savings.
The calculation of the internal rate of return (IRR) considering the cash flows net of financing gives us the equity IRR.
The Project IRR is calculated without considering the financing structure (debt equity ratio) of a project. If the project is fully funded by equity, the project IRR and equity IRR will be the same.
Net-Present Value (EUR) is the difference between the present value of cash inflows and the present value of cash outflows. Present value (PV) is the current worth of a future sum of money or stream of cash flows given a specified rate of return. Future cash flows are discounted at the discount rate, and the higher the discount rate, the lower the present value of the future cash flows.
If you have received an quote from a PV installer simply divide your total cost by the system size in kWp.
20 years are commonly used for the system, and costs for replacing components with a shorter lifetime (inverters, batteries) are already considered in the calculations. Quality modules come with warranties above 20 years and will most likely operate up to 30 years under good maintenance conditions.
Individual interest rates for commercial loans apply if the system is based on self-consumption or on a supply contract without a feed-in tariff as fall back option.
The electricity price increase in % p.a. has a significant impact on a systems economics. In recent years we have seen steep increases in many countries. However, in the longterm this yearly increase will probably average in the range of the longterm inflation rate.
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