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RESEARCH PRODUCT

ECONOMIC ANALYSIS OF SUPPORT POLICIES IN PHOTOVOLTAIC SYSTEMS: A COMPARISON BETWEEN THE TWO MAIN EUROPEAN MARKETS

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The development of the photovoltaic (PV) sector in the last decade was spurred by the implementation of various support strategies aimed at reducing the gap between PV energy cost and the energy price for conventional generation. The deployment of support policies has pushed the reduction of PV energy costs, but despite this PV is still not very competitive and its development still requires adequate support mechanisms, simple grid connection procedures, and so on. This chapter provides a technical-economic analysis of investments in PV systems, evaluating the positioning of the main European markets (Germany and Italy), with the purpose of highlighting the main differences in the implementation of support policies in the two top countries. Several case studies are examined, differentiated in relation to the rated power (from 3 kW to 1 MW) and the type of plant (ground-mounted and rooftop PV systems). The profitability indexes in terms of the payback period (PBP), net present value (NPV) and the internal rate of return (IRR) are evaluated throughout the reference period. The chapter is expected to be very useful for policy makers, energy producing industries and national Governments to estimate the profitability of PV investments in the two selected countries, predicting how the PV sector will evolve in each of the two EU states.