Submitted by elsbeth on Wed, 2009-10-28 12:07

How much does electricity from PV cost?

 

The costs of electricity from a grid-connected PV system are determined by a number of factors:

  • the power output (850 kWh per year for a 1 kWp system)
  • the investment costs for the PV system
  • the costs for maintenance, management, and insurance (1% of the investment per year)
  • the depreciation period (20 years)
  • the interest rate (5 %)

Under the above conditions, we can use the following rule of thumb: the electricity costs per kWh are equal to the investment costs per Wp divided by 10. If we assume a price of € 3.50/Wp, the power costs will be € 0.35/kWh. This calculation has not factored in any subsidies paid out per kWh produced by the solar panels.