THE VIABILITY OF RESIDENTIAL GRID-CONNECTED SOLAR PHOTOVOLTAIC SYSTEMS IN THE STATE OF INDIANA

Abstract

While the use of green energy has gained popular support and efforts have been made to market it, few studies have investigated the economic advantages and the savings that could be gained by implementing green solutions for energy challenges. This study aims to measure the financial viability of installing and using a residential grid-connected photovoltaic (PV) system in the State of Indiana while predicting its performance in eighteen geographical locations within the state over the system’s expected lifetime. A systematic approach of six steps was used to collect and analyze the data. The analysis has been condcutded using engineering economic methods including payback period, net present value (NPV) and internal rate of return (IRR). It has been found that installing a PV system for a single family residence in the State of Indiana will not pay for itself within 25 years assuming the average cost of a system. The government incentive programs are not enough to offset the cost of installing the system against the cost of the electricity that would not be purchased from the utility company.

Keywords

• Net present value,internal rate of return,payback period,residential solar PV system,renewable energy,State of Indiana

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