First, the hypothetical case where there is no degradation was considered, and an energy model was structured, calculating the power capacity of the PVSS based on the available installation area and given technology. Then, the cost analysis was completed introducing the costs of engineering services required, PVSS, transportation, operations, maintenance, and periodic costs in the life-cycle cost platform. Afterwards, the GHG emission reduction due to the possible application of the proposed system was analyzed. Next, the Internal Rate of Return (IRR), Net present value (NPV), Benefit to cost ratio (BCR), and Equity payback period were calculated after introducing the inflation, discount rate, and feed-in-tariff (FIT) in the model.
After this, the model that includes degradation was studied, introducing the average deterioration rate of PV panels for Mediterranean climates, evaluating the reduced annual power per year. Moreover, after including the electricity escalation rate, feed-in-tariff, and overall expenses on the project, the new values for the NPV, IRR, MIRR, and BCR were recalculated. Finally, both the sensitivity and risk analyses were performed.
Energy model.
The first step to create the energy model in Shymkent, is to make a comparison between the daily average solar radiation with other cities of Kazakhstan, and it can be seen in Table 1 that Shymkent is the city that receives the largest irradiance in the country.
Table 1
COMPARISON OF AVERAGE DAILY SOLAR RADIATION IN DIFFERENT KAZAKHSTAN REGIONS (Kaplani 2012).
City | Region | Daily Solar Radiation – horizontal (kWh/\({\varvec{m}}^{2}\)/d) |
Astana | North | 3.55 |
Almaty | Southeast | 3.59 |
Shymkent | South | 4.45 |
Taraz | South | 4 |
Kyzylorda | South | 4.21 |
Uralsk | Northwest | 3.55 |
Pavlodar | Northeast | 3.51 |
Karaganda | Central | 3.71 |
Aktau | Southwest | 3.92 |
Kokcetav | North | 3.36 |
Semipalatinsk | East | 3.81 |
The average daily radiation that the tilted PV panels receive per year is 5.06 kWh/m2/d (Table 2), and as it is higher than the average daily radiation of the horizontal panels, those 30° tilted PV modules where chosen for this study. Furthermore, that arrangement allows rain to clean the solar panels, which reduces miscellaneous losses to 2–3% (Table 3).
Table 2
DAILY SOLAR RADIATION FOR HORIZONTAL AND TILTED PV MODULES. DATA OBTAINED FROM THE RETSCREEN EXPERT PLATFORM.
Month | Daily solar radiation -horizontal kWh/m2/d | Daily solar radiation -tilted kWh/m2/d |
January | 1.77 | 2.86 |
February | 2.58 | 3.6 |
March | 3.95 | 4.81 |
April | 5.31 | 5.72 |
May | 6.5 | 6.39 |
June | 7.24 | 6.84 |
July | 7.25 | 6.97 |
August | 6.35 | 6.61 |
September | 5.11 | 6.04 |
October | 3.52 | 4.84 |
November | 2.14 | 3.42 |
December | 1.52 | 2.47 |
Annual | 4.45 | 5.06 |
In order to fit the area of 2820 m2, the PVSS with a power capacity of 300kWp was selected, and one of the assumptions was that there should be space available for movement between the solar panels. Therefore, the estimation is that 59 mono-Si PV panels would be needed to cover the rooftop area and as the average solar radiation is 5.06 kWh/m2/d per year, those panels would have up to 300 kWp of power capacity (Table 3).
Table 3
POWER PARAMETERS OF PVSS.
Photovoltaic type | Mono-Si |
Power capacity (kWp) | 300 |
Efficiency (%) | 11 |
Solar collector area (m2) | 2727 |
Miscellaneous losses (%) | 3 |
Malvoni et al. estimated the performance of a PVSS that was exposed to the Mediterranean climate outdoors using the Classical Seasonal Decomposition (CSD) method (Assamidanov, Nogerbek, and Rojas-Solorzano 2018). The results of their experiment showed that the degradation rate of the PVSS was about 1.48%/year. The CSD is a common technique used to calculate the degradation rate and does not have significant uncertainties.
The reduction of the PV output power due to the annual degradation rate was introduced into the energy model with the lifespan of the project being of 25 years. Moreover, 25 different sub-models were introduced in the RETScreen platform to estimate the energy production by year after considering degradation processes, and after that, every calculated year’s production was used to build up the lifetime cash flow. Moreover, miscellaneous losses each year were increased to reflect the deterioration of the PV module performance, such that the electricity exported to the grid was reduced by 1.48% in each subsequent year. The final calculation of the output power for each year is shown in Table 4.
Table 4
ELECTRICITY EXPORTED TO GRID AFFECTED BY PV MODULE DEGRADATION IN EACH YEAR.
Year | Electricity exported to grid (MWh) |
1 | 436.00 |
2 | 429.55 |
3 | 423.19 |
4 | 416.93 |
5 | 410.76 |
6 | 404.68 |
7 | 398.69 |
8 | 392.79 |
9 | 386.97 |
10 | 381.25 |
11 | 375.60 |
12 | 370.05 |
13 | 364.57 |
14 | 359.17 |
15 | 353.86 |
16 | 348.62 |
17 | 343.46 |
18 | 338.38 |
19 | 333.37 |
20 | 328.44 |
21 | 323.57 |
22 | 318.79 |
23 | 314.07 |
24 | 309.42 |
25 | 304.84 |
Cost Analysis.
The cost of obtaining PV modules is roughly 1–3$/W (Malvoni et.al. 2017). For this project, PV panels would be obtained for 1$/W (388.29 KZT). Thus, the cost of one photovoltaic module is 1000$ (388,290 KZT) per one kW.
Table 5
INITIAL COSTS for the installation of the PVSS modules in the rooftop of the Shymkent airport.
Initial costs | Quantity | Unit cost (KZT) |
Engineering cost | 1 | 1,242,892 |
Photovoltaic | 300 kWp | 388,290 |
Transportation | 1 | 700,000 |
Subtotal | | 118,429,892 |
Contingencies | 5% | 5,921,495 |
Total initial costs | | 124,351,387 |
Transportation of all the PV modules was assumed to cost 700,000 KZT, and 5% of contingencies were assumed. Engineering cost is assumed to be 1% of the total initial cost (1,242,892 KZT). Therefore, including all of these expenses, the total amount of initial costs is 124,351,387 KZT, and the costs are shown in Table 5.
According to Plante (Wattsap.kz 2020), there is no need to include expenses for the periodic costs because the PVSS only needs the inverter replacement after 15–16 years, which means that during the life span of the system, there would be only one inverter replacement. Inverters usually cost 10% of the total cost (Plante 2014), so it would cost 12,435,139 KZT in this case. Moreover, there are also labour maintenance costs of approximately 480,000 KZT per year to have one technician checking and maintaining the PVSS that would clean the PVSS after snow and dust storms, among other tasks. All annual costs (O&M) are shown in Table 6.
Table 6
OPERATING AND MAINTENANCE AND PERIODIC COSTS.
Annual costs (O&M) | Quantity | Unit cost (KZT) |
Labor | 2 | 480,000 |
Subtotal | | 960,000 |
Periodic costs | Year | Unit cost (KZT) |
Replacement of inverters | 15 | 12,435,139 |
GHG Emission analysis.
The GHG emission factor in Kazakhstan’s grid is 0.582 tCO2e/MWh (The World bank 2018). However, the World Bank suggests that the electric power transmission and distribution losses (T&D) in Kazakhstan in 2014 was 7% per year. (Solar Reviews n.d.), and when the T&D is included, the GHG emission factor increases to 0.626 tCO2e/MWh. Moreover, the GHG emission for the base case without and with PVSS (not considering degradation) are 273.1 tCO2e/MWh and 19.1 tCO2e/MWh, respectively. Therefore, for the base case system, the gross annual GHG emission reduction is equal to 253.9 tCO2e per year. Furthermore, even if we include the degradation rate in the system, the emissions would be reduced by the same amount in the first year. However, by the 25th year, the PVSS with degradation would have an emission reduction of only 174.9 tCO2e.
Financial Analysis. Input parameters.
For the financial analysis, an assumption of zero GHG income during the whole project was made. The average inflation rate in Kazakhstan in the last ten years has been 7.31% per year, and this value was used for this study (Asian Development Bank 2017).
On the other hand, the Feed-in tariff in Kazakhstan is equal to 34 KZT/KWh (Plecher 2019). The electricity escalation rate was considered to be of 7.31%, which is the same percentage as the average inflation rate calculated. No loans or grants are considered. Based on the last five years, the discount rate is about 11.1%, according to the National Bank of Kazakhstan (Kursiv 2019). These values shown in Table 7 are the input parameters for the financial analysis. The airport is owned by the governmental “Airport Management Group” company, so there are no taxes to be considered (National bank of Kazakhstan 2019).
Table 7
INPUT PARAMETERS IN THE FINANCIAL ANALYSIS.
Inflation rate (%) | 7.31 |
Discount rate (%) | 11 |
Project life (years) | 25 |
Incentives and grants ($) | 0 |
Electricity export escalation rate (%) | 7.31 |
Feed-in Tariff (KZT/kW) | 34 |
Electricity exported to the grid (MWh) | 436 |