Analysis of solar photovoltaic utilization in industrial sector for improving competitiveness in the smart grid

Author(s):Eko Adhi Setiawana, Fitria Yuliania,a,b *
a Tropical Renewable Energy Center Faculty of Engineering, Kampus Baru Universitas Indonesia, Depok,16424, Indonesia
b The Directorate-General of New Renewable Energy and Energy Conservation, Ministry of Energy and Mineral Resources of the Republic of Indonesia, Pegangsaan Menteng, Jakarta, 10320,Indonesia
International Journal of Smart Grid and Clean Energy, vol. 7, no. 4, October 2018: pp. 276-285
ISSN: 2315-4462 (Print)
ISSN: 2373-3594 (Online)
Digital Object Identifier: 10.12720/sgce.7.4.276-285

Abstract: The industrial sector is the second largest energy consumer after the household sector, which is 35% of the total energy demand. In Indonesia by 2050, electricity demand in this sector will reach 660 TWh (Terra-watt hours) or 10 times from 2015. Moreover, the electricity tariff tends to keep increasing in the range of 3 - 10 percent per year. This paper develops solar PV rooftop financial scenario and analyzes the sensitivity factors to the LCOE (Levelized Cost of Energy), thus gaining the financial advantages and competitiveness in Smart-grid System. The results show that the solar PV rooftop in the industrial sector can provide an annual electric power circa 16% of the total electricity demand. The payback period also can be achieved under 10 years, with return on investment continues to increase until the 20th year with positive NPV (Net Present Value). The NPV is derived from the electricity cost savings without using solar PV systems. The increased installed of solar PV capacity will boost the NPV. However, it is limited by the available land area and the economic value of the solar PV systems cost.

Keywords: Financial scenario, Solar PV, Industrial Sector, LCOE, Smartgrid
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