Applied Energy 151 (2015) 49ndash59

Contents lists available at ScienceDirect

Applied Energy

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Levelised cost of electricity in high concentrated photovoltaic gridconnected systems Spatial analysis of Spain

httpdxdoiorg101016japenergy2015040720306-2619 2015 Elsevier Ltd All rights reserved

uArr Corresponding author Tel +34 953 212 809E-mail address dlopezujaenes (DL Talavera)

DL Talavera auArr P Peacuterez-Higueras a JA Ruiacutez-Arias b EF Fernaacutendez ca

a IDEA Research Group University of Jaeacuten Campus Lagunillas 23071 Jaeacuten Spainb MATRAS Research Group University of Jaeacuten Campus Lagunillas 23071 Jaeacuten Spainc Environment and Sustainability Institute University of Exeter Penryn Cornwall TR10 9EZ United Kingdom

h i g h l i g h t s

The LCOE of HCPV grid connected systems in Spain is estimated and analysed A new set of parameters and a deep explanation of the procedure are introduced A set of innovative maps relating to the LCOE and energy yield is presented The analysis and detection of the optimal zones for HCPV technology is conducted A comparison between the LCOE of HCPV and PV systems in a future scenario is done

a r t i c l e i n f o

Article historyReceived 4 November 2014Received in revised form 24 March 2015Accepted 17 April 2015

KeywordsLevelised cost of electricityHigh Concentrator PhotovoltaicSpatial analysis

a b s t r a c t

Costs for High Concentrator Photovoltaic (HCPV) power plants dropped dramatically during 2013 and areexpected to continue to fall in the next few years Moreover when viewed from the perspective of lifecycle cost HCPV becomes even more competitive than other renewable technologies in some geograph-ical areas Consequently an analysis of the economic feasibility of the HCPV systems in future scenarios isnecessary for comparison with other electricity generation technologies One of the methods commonlyused for the economic feasibility analysis in electricity generation projects is the levelised cost of electric-ity (LCOE) In this paper a cost analysis of electricity generation of HCPV technology in Spain by using theLCOE has been carried out The results obtained in this LCOE analysis show that in 2020 the LCOE will beable to reach values for HCPV systems from 0035 to 0080 eurokW h lower than LCOE for conventional PVsystems in some geographical areas of Spain The results obtained in this analysis have been shown ininnovative maps

2015 Elsevier Ltd All rights reserved

1 Introduction

High concentration photovoltaic (HCPV) systems use opticaldevices (lenses or mirrors) to concentrate the solar radiation ontosmall solar cells Although there are a large number of possibleconfigurations in order to implement HCPV grid connected sys-tems [12] a typical system consists of modules composed of sev-eral electrically connected high efficiency III-V multi-junction solarcells with their associated optics that concentrate the solar light bya factor of 500 and 1000 times an accurate two-axis solar trackeran efficiency inverter and other components such as cables andconnectors

There are different types of concentration photovoltaic systemsthat are usually classified depending on the concentration ratioThis paper is exclusively focused on the analysis of high concentra-tion photovoltaic systems as they have passed the demonstrationphase and begun the industrialization and commercializationphase with 160 MW of installed power worldwide in 2013 In addi-tion the cumulative installed capacity of HCPV can jump from358 MWp in 2014 to more than 1 GW in 2020 [3]

Due to the use of lenses to concentrate the light HCPV systemsonly react to the direct component of the solar irradiance Althoughthe performance of these systems is mainly determined by thedirect normal irradiance they are also affected by other parame-ters such as temperature spectrum and wind speed [4] As wasnoted HCPV systems use accurate two-axis trackers since themodules must be always pointing towards the sunrsquos rays in orderfor the lenses to concentrate the direct normal irradiance on the

50 DL Talavera et al Applied Energy 151 (2015) 49ndash59

solar cell surface Because of this they are more appropriate forlarge-scale implementation in large PV plants (larger than1 MWp) at locations with high annual direct normal irradiationlevels such as in the south of Europe MENA and Australia

Some methods commonly used for the economic feasibilityanalysis in electricity producing photovoltaic systems are the netpresent value (NPV) the discounted payback time (DPBT) theinternal rate of return (IRR) and the levelised cost of electricity(LCOE) [5ndash10] However the LCOE method is the most often usedwhen comparing electricity production technologies (both renew-ables and conventional energies) [11ndash18] Besides the LCOE ofrenewable energy technologies is a widely used measure by whichrenewable energy technologies can be evaluated for modelling orpolicy development [19] Levelised cost of electricity can bedefined as the constant and theoretical cost for every unit of elec-tricity produced by the system over the analysis period (usuallylifetime) in nominal or real monetary units [20]

The LCOE has been widely used for the analysis of conventionalPVs [7111217182122] However due to the fact that HCPV is anew technology there is a lack of studies concerning the analysisof the LCOE [1323] In [13] a report focusing on the analysis ofthe LCOE of several renewable energies was conducted byFraunhofer ISE This work is focused on the analysis of photo-voltaics wind power and biomass power plants in GermanyRegarding HCPV the study is limited to two locations with differ-ent annual direct normal irradiations In [23] the analysis of theLCOE of two HCPV power plants at locations with different annualdirect normal irradiations in USA was presented by SolFocus Inc atICSC-5 conference This work is focused on the LCOE of SolFocustechnology and therefore has a commercial approach and is not adeep research analysis of the LCOE of HCPV technology

Bearing this in mind an in-depth analysis of the LCOE of theHCPV technology is required to evaluate the potential of thisemerging technology Therefore in the present contribution theLCOE of HCPV at the end of 2013 is analysed for Spain In additionLCOE values in a future scenario based on HCPV technology learn-ing curve and market have also been predicted Also severalimprovements in the estimation of the LCOE compared with theprevious works in order to quantify tax depreciation and annualescalation rate of the operations and maintenance cost have beenintroduced Furthermore a methodology based on a set of innova-tive maps relating to the LCOE and energy yield of HCPV is pre-sented These maps are a useful tool since they allow the spatialanalysis of the LCOE at a wide range of productivity levels to bedone Furthermore with the proposed methodology it is possibleto identify the optimal locations for HCPV systems where theycan be considered a more profitable technology than conventionalPV The current tools based on graphs and tables do not allow thesezones to be detected Moreover the proposed methodology basedon maps is easy to manage and could be consulted by future own-ers investors and financiers of HCPV systems Also this methodol-ogy can be used at different worldwide regions in order to identifythe optimal locations for HCPV technology

In this paper we define as HCPV systems a grid-connectedpower plant with a nominal power larger than 1 MWp made upof HCPV module with the features mentioned above Also wedefine as conventional PV systems a grid-connected power plantwith a nominal power larger than 1 MWp made up of fixed opti-mally oriented c-Si modules

It is worth mentioning that the spatially-distributed estimate ofLCOE over the study region has been possible based on a spatially-distributed estimate of the total annual DNI The DNI annualamount has been determined from a 10-yr dataset of monthlyDNIs [24] so that the effect of the inter-annual DNI variability isproperly accounted for and the long-term DNI can be estimatedwith an uncertainty as low as 5 [25] Any possible DNI tendency

which might be attributed to climate change has been neglectedbecause the impact of climate change effects in the time scales ofthis study is hypothesized as small and any estimate of theseeffects would be highly uncertain particularly concerning theeffect of atmospheric aerosols

2 Methodology for calculating the levelised cost of electricity

As was explained the method for the cost analysis used in thispaper is the levelised cost of electricity The calculation proceduresare similar to those presented in previous works [8] However sev-eral improvements in order to quantify tax depreciation andannual escalation rate of the operations and maintenance cost havebeen introduced This method will be shown below

Levelised cost of electricity can be defined as the constant andtheoretical cost of production of HCPV electricity over its life timeexpressed as

LCOE frac14 LCCPNnfrac141

En 1rdeth THORNn1thorndeth THORNn

eth1THORN

where LCC is the life cycle cost (euro) of the system rd is the annualdegradation rate in the efficiency of the HCPV modules ofthe HCPV system E is the annual HCPV electricity yield(kW h(kWp year) d is the nominal discount rate and N is the usefullife of the HCPV system

Assuming that annual HCPV electricity yield (E) remains con-stant over the life-cycle the LCOE may be estimated by

LCOE frac14 LCC

EPN

nfrac1411rdeth THORNn1thorndeth THORNn

eth2THORN

If the parameter Kd is equal to (1 rd)(1 + d) the Eq (2) can beexpressed

LCOE frac14 LCC

EKd 1KN

deth THORN1Kd

eth3THORN

The life cycle cost of the HCPV system (LCC) may be calculated by

LCC frac14 HCPVI thorn PWfrac12HCPVOMethNTHORN PWfrac12DEP T eth4THORN

where HCPVI (euro) is the initial investment cost of the HCPV systemPW[HCPVOM (N)] is the present worth of operation and mainte-nance cost of the system and PW[DEP] is the present worth of thetax depreciation and T is the tax rate

Concerning the operation and maintenance cost of the life cycleof the system PW[HCPVOM (N)] can be written as

PWfrac12HCPVOMethNTHORN frac14 HCPVAOMeth1 TTHORN KP eth1 KNP THORN

1 KP

eth5THORN

where HCPVAOM is the annual operation and maintenance costswhich are fixed during the system life cycle The parameterKp = (1 + rOampM)(1 + d) and rOampM is the annual escalation rate of theoperation and maintenance cost of the system N is the life cycleof the HCPV system

If the tax depreciation is calculated as lineal over the time per-iod and DEP is the annual tax depreciation (euro) for the HCPV systemthe present worth of the tax depreciation may be calculated by

PWfrac12DEPethNdTHORN frac14 DEPy q eth1 qNd THORN

1 qeth6THORN

where the factor q is equal to (1(1 + d)) Nd is the tax life for depre-ciation (years) and parameter DEPy is the annual tax depreciationfor the HCPV system ndash DEPy is constant

The share of external financing and equity financing can beincluded in the analysis explicitly through the weighted average

DL Talavera et al Applied Energy 151 (2015) 49ndash59 51

cost of capital (WACC) over the discounting factor (nominal dis-count rate) HCPVI (euro) is the initial investment cost of the HCPV sys-tem which may be financed through long-term debt andor equitycapital If HCPVI is financed through a loan (HCPVl) and equity cap-ital (HCPVec) so that HCPVI = HCPVl + HCPVec Therefore this can bewritten as

HCPVI frac14 HCPVl ileth1 TTHORN

1 1thorn ileth1 TTHORNeth THORNNl q eth1 qNl THORN

1 q

thorn ethdec HCPVecTHORN q eth1 qNTHORN

1 qthornHCPVec qN

eth7THORN

The first term of Eq (7) depicts the loan HCPVl is borrowed at anannual loan interest (il) to be repaid in Nl years The second termdepicts the equity capital with an annual payback in the form ofdividends (dec) and it is amortized at the end of the life cycle ofthe system It is worth mentioning that the left-hand side ofEq (7) only equals its right-hand side if the selected value of d isequal to the weighted average cost of capital (WACC) of theinvestment

WACC is the cost that the owner or investor of the project mustpay for the use of capital sources in order to finance the invest-ment A widespread practice in organizations is to use a nominaldiscount rate (d) equal to the organizationrsquos weighted average costof capital [20] In this paper nominal discount rate is assumed to beequal to WACC in order to calculate the LCOE

Table 1Values provided by some HCPV Companies concerning DNI yield and performanceratio

Companylocation DNIA

(kW hm2)YHCPV

(kW hkWp year)PR () Reference

SoitecTouwsrivier 2447 1878 76ndash81 [42]SolfocusISFOC 1861 1914 887 [34]MagPowerPortugal 1978 2113 91 [43]SempriusNREL 2446 2079 85 [44]Solar systems

Hermannsburg2464 2104 854 [40]

3 Estimation of parameters involved in the calculation LCOE

This review will lead to the identification of the value of theparameters for the analysis of the HCPV and conventional PV sys-tems for a scenario in the year 2013 and a future scenario In thisfuture scenario the value of the parameters for the analysis ofthe HCPV and conventional PV systems will have the same valuesexcept for the operation and maintenance costs and solar irradia-tion It should be noted that the figures presented here referringto costs and electricity yields are all normalized-per-kWp Thesymbols used for these factors are the same for those not normal-ized except that they are shown in brackets and with the subscriptlsquokWprsquo

31 Calculation of the HCPV electricity yields

There are different methods [2627] to calculate the energy gen-erated by a grid-connected photovoltaic system the method basedon the Performance Ratio (PR) being one of the most often usedAccording to the IEC standard 61724 [28] the year-round electric-ity generated by a conventional PV system with fixed panels opti-mally inclined over the horizontal and permanently orientedsouthward can be estimated using the following equation

YFV frac14 PRHopt A

GSTCeth8THORN

where YFV is the final AC annual energy yield in a conventional FVsystem (kW hkWp year) Hopt A is the annual global irradiation onoptimally inclined plane (kW hm2 year) and GSTC is the global irra-diance at standard test condition (1 kWm2)

The value of PR in a conventional PV system usually ranges from070 to 080 In this case we have used a value of 075 based onexperience of this kind of system [29ndash33]

The annual electricity generated by a HCPV system can be esti-mated using the following equation

YHCPV frac14 PRDNIA

DNISTCeth9THORN

where YHCPV is the final AC annual energy yield in a HCPV system(kW hkWp year) DNIA is the annual direct normal irradiation(kW hm2 year) and DNISTC is the direct normal irradiance at stan-dard test condition (1 kWm2)

The value of PR in a typical HCPV system ranges from 076 to091 [34ndash44] as shown in Table 1 Based on the analysis of thesedata an intermediate value of PR = 082 has been considered forthis study

Fig 1 shows the final AC annual energy yield of a typical HCPVsystem in Spain It has been obtained from Eq (9) using a spatiallydistributed estimate of DNIA and assuming a constant PR value of082 DNIA was evaluated following the approach described in[24] which is briefly outlined in the following using the WeatherResearch and Forecasting (WRF) numerical weather predictionmodel [45] Since release v36 the WRF model can output DNI[4647] being probably the first model of its class with this addedcapability The entire area of Spain was simulated at a spatial reso-lution of 10 km for the period from January 2003 to December 2012The modelrsquos DNI outputs were annually aggregated and averagedover the 10-year period to obtain the map of DNIA Using this timescale a data assimilation process was conducted to correct DNIA

based on the annual DNI measured at the more than 50 radiometricstations of the National Radiometric Network of the SpanishNational Weather Service The data assimilation process ensuresan average a DNI estimate with negligible bias and uncertainty ofonly 5 with respect to the ground observations As can be seenin Fig 1 the available DNIA depends highly on the location of inter-est thus being a source of strong spatial variability of the final ACannual yield of a HCPV system installed in the study region Theavailable normal direct irradiation depends highly on the locationof the site and is a crucial factor for the calculation of the final ACelectricity annual yield of an HCPV system In this map a bluecoloured area located in the north can be seen showing the lowestelectricity annual yield with a minimum value of 805 kW h(kWp year) (location number 3 Table 2) The area with the highestelectricity annual yield is located in the south of the map with amaximum value of 1821 kW h(kWp year) (location number 1Table 2) Furthermore there are high values of electricity annualyield in locations in the middle and northeast of the map for exam-ple of 1743 kW h(kWp year) (location number 4 Table 2)

Table 2 shows the values of annual irradiation Yield and LCOEof five locations with the following characteristics Location num-ber 1 presents the highest value of DNIA Location number 2 has amedium value of DNIA Location number 3 presents the minimumvalue of DNIA Location number 4 has the maximum differencebetween DNIA and Hopt and Location number 5 has the minimumdifference between DNIA and Hopt These values will be discussedin future sections

32 Estimation of remaining factors involved in the analysis

According to the parameters described in the previous sectionsthe typical normalized-per kWp initial investment cost in HCPV orconventional PV systems are shown in Table 3

Fig 1 Annual electricity yields in Spain produced by a 1-kWp HCPV system (kW hkWpyear) with performance ratio equal to 082

Table 2Irradiation yield and LCOE values for different Spanish locations

Number Location Latitude Longitude DNIA

(kW h(m year))Hopt

(kW h(m2 year))YHCPV

(kW h(kWp year))YPV

(kW h(kWp year))LCOEHCPV (eurokW h)Scenario

2013 2020

1 Granada 3743 322 2221 2043 1821 1532 0081 0035 DNI maximum2 Cuenca 3990 196 1960 1868 1607 1401 0092 0040 DNI median3 Cantabria 4309 437 982 1171 805 878 0184 0080 DNI minimum4 Toledo 3993 535 2126 1904 1743 1428 0085 0037 (DNIndashHopt) maximum5 Burgos 4309 374 1044 1249 856 937 0173 0075 (DNIndashHopt) minimum

Table 3Installed system prices for 2013 (Sources Conventional PV systems [48] HCPVsystems [1314])

Power (gt1 MW) Conventional PV HCPV Units

Normalized-per-kWpinitial investment cost

1000ndash1400 1400ndash2200 eurokWp

52 DL Talavera et al Applied Energy 151 (2015) 49ndash59

Regarding the inflation rate (i) reviewing the averages of histor-ical data for Spain in the period 2007ndash2013 [49ndash52] a value for theinflation rate equal to 22 can be assumed see also Table 4

Table 4Average rate of inflation in the period 2007ndash2013

Year 2007 2008 2009 2010 20

Annual average rateof inflation ()

28 41 02 20 3128 41 03 18 3228 41 02 21 31

Initial investment cost may be financed by means of debt andorequity capital Long-term loans and equity capital have beenselected in this paper It has been assumed that 80 of this amountis borrowed as a loan ndash debt while the remaining investmentamount 20 is contributed from equity capital Regarding the con-ventional PV systems the loan il is considered equal to 4 Nl equalto 20 years [5354] while equity capital dec equal to 8 [13] beingamortized at the end of the life cycle of the system for PVConcerning the HCPV the loan il is considered equal to 6 Nl equalto 20 years while the equity capital dec equal to 12 and beingamortized at the end of the life-cycle of the system HCPV projects

11 2012 2013 Average rate of Inflation(2007ndash2013) ()

Reference

24 15 224 [51]24 14 220 [52]24 15 226 [50]

DL Talavera et al Applied Energy 151 (2015) 49ndash59 53

have a risk higher than conventional PV system so return onequity capital (dec) and cost of the loan (il) are higher values

The income tax rate (T) for the organization or taxpayerchanges depending on each countryrsquos regulations The value ofincome tax rate is assumed equal to 30 for this study The methodused in the tax depreciation have been based on a general methodusing a maximum linear coefficient of 5 with a tax life for depre-ciation of 20 years [5556]

The annual HCPV electricity yield generated by the system isassumed to decrease every year Annual degradation rate (rd) inthe efficiency of the PV panels is 05year [1157] The analysisperiod is equal to the life time of the HCPV system thereforeN = 30 years Nowadays conventional PV systems have a life cycleof around 30 years and more Salvage value of the system at theend of their life-cycle (SV) is taken as equal to zero

The nominal discount rate (d) is assumed equal to the weightedaverage cost of capital in order to calculate the LCOE [1320] This

Table 5Values of the factors assumed for the calculation of LCOE on HCPV systems in thescenario for 2013

Factors Case base values Units

YHCPV According Fig 1 kW h(kWp year)[HCPVI]kWp 1800 eurokWp[HCPVAOM]kWp 28 eurokWprd 05 yearrOampM 22 yearT 30 i 22 d 649 il 6 Nl 20 yearsdec 12 N 30 years

Fig 2 LCOE for HCPV systems in S

capital cost will vary depending on how the capital resources arechosen to finance the initial investment cost The after-tax WACCvalues are shown in Tables 5 and 9

Normalized-per-kWp annual operation and maintenance costsare estimated to be 20 eurokW year for the conventional PV systems[485818] Meanwhile normalized-per-kWp annual operation andmaintenance cost is taken at 28 eurokW year for the HCPV systems[1458] Annual escalation rate of the operation and maintenancecost (rOampM) is set equal to the value of the annual inflation rateso rOampM = 22 for both systems

To summarise the figures selected and assumed for each of thefactors that define the case base for the HCPV systems are shown inTable 4 while Table 8 shows the figures for the case base of con-ventional PV systems and HCPV systems in the future scenarioSolving the equations presented in Section 2 together with the fig-ures shown Tables 5 and 9 in a spreadsheet paves the way to theestimation of the LCOE for each of the scenarios

4 Analysis and results

In this section the levelised cost of electricity of HCPV technol-ogy in Spain has been estimated This study has taken solar irradi-ation according to the area selected geographically while theremaining parameters involved in the analysis were kept constantFurthermore the results obtained in this analysis have been shownin innovative maps

41 Levelised cost of electricity of HCPV

Solving the equations and following the procedure presented inSection 2 using the values provided in Table 5 and the annual HCPVelectricity yields of Fig 1 the LCOE for HCPV systems in Spain inthe year 2013 has been estimated

pain in the scenario for 2013

Fig 3 Forecast of the HCPV world cumulative capacity based on the three scenariosconsidered Low Conservative and Accelerated Market forecast conducted by theprivate companies IHS (HIS) Globaldata (GD) and SPV Market (SPV)

54 DL Talavera et al Applied Energy 151 (2015) 49ndash59

Fig 2 represents the levelised cost of electricity of HCPV sys-tems larger than 1 MWp and assuming a system performance ratio082 for 2013 In Fig 2 all data values are given as eurokW h As can beseen the area with the highest values of LCOE is located in thenorth of the map with a maximum value of 0184 eurokW h (locationnumber 3 Table 2) The area with the lowest values of LCOE islocated in the south of the map with a minimum value of0081 eurokW h (location number 1 Table 2) Furthermore thereare also other locations with low values of LCOE in the middle ofthe map with values of 0085 eurokW h (eg location number 4Table 2) and in the northeast of the map with values around0089 eurokW h In this scenario HCPV systems with a DNIA rangingfrom 2221 to 982 kW h(m2 year) can reach LCOE values rangingfrom 0081 to 0184 eurokW h respectively

The validation of the results obtained is difficult since there areno studies concerning the analysis of the LCOE of HCPV systems inSpain However in order to validate the results found Table 6shows the values of LCOE obtained for similar technologies andscenarios for different organizations It is important to note thatalthough similar the scenarios and inputs for the estimation ofthe LCOE are not the same Because of this different results areexpected However as can be seen the values of LCOE obtainedin this work are similar to those presented by other authors Forexample the study performed by Fraunhofer ISE analyses locationswhose DNIA range from 2000 to 2500 kW h(m2 year) and the val-ues of LCOE obtained range from 008 to 015 eurokW h These resultsare almost equal to those obtained in this study with values ofLCOE ranging from 008 to 018 eurokW h (the values are slightlyhigher since the DNIA in Spain varies from 1000 to 2200 kW h(m2 -year)) Also Solfocus Inc [59] estimates a LCOE of 008 eurokW h forlsquolsquoVictor Valley Collegersquorsquo power plant located in Victorville CA (USA)with an DNI of 2628 kW(m2 year) and GTM Research Inc [60] esti-mates a LCOE of 007 eurokW h for a power plant located in PhoenixAZ (USA) with an DNI of 2518 kW(m2 year) Hence it can be con-sidered that the results found here are accurate and are represen-tative of HCPV systems located in Spain

42 Comparison between the LCOE of HCPV and conventional PVsystems

The forecasting of the evolution of the market for a new tech-nology is a complex issue mainly due to the lack of historical dataand because of the rapid advances that occur in the first stages ofdevelopment In addition this evolution will be dependent onother factors such as the economic crisis and the support programsimplemented by several countries Because of this a reduction inthe manufacturing costs of the solar cells and the introduction oflow cost materials for manufacturing new optical devices areexpected in the next few years These will bring important indus-trial growth and consolidation in the manufacturing of HCPVmodules

HCPV technology has two main advantages when comparedwith other sources of energy [63] Firstly the high potential costreduction because of the reduction of expensive semiconductormaterials by cheaper optical devices The other main advantagesof HCPV compared with conventional PV technology are that the

Table 6LCOE for 2013 using the exchange rate 1euro = 136$ [136162]

Technology Organization LCOE (eurokW h)

Conventional PV EPIA 009ndash019Conventional PV IEA 012ndash016Conventional PV Fraunhofer ISE 007ndash010HCPV Fraunhofer ISE 008ndash015HCPV University of Jaeacuten 008ndash018

distribution of costs in a HCPV system has a wider spectrum thecost of cells not having such an important influence on the globalcost The result is that a great part of the system cost is transferredfrom the cells to other more varied and readily available technolo-gies leaving room in projects and investments from other very dif-ferent industrial sectors that can easily be adapted to manufacturethese new products (plastic glass metal mechanical industriesetc) The high efficiency of the elements of HCPV implies a reduc-tion of the area required for these systems leading to a substantialdecrease both in the investment and the price of the electricitygenerated Concentration cells have reached an in lab maximumefficiency of 44 [64] Therefore concentration modules are beingmanufactured with about 30ndash35 [65] efficiencies and the resultsof the measurements performed to the already installed HCPV sys-tems show values that double the efficiencies of the conventionalPV systems

Several market analyses [36667] indicate that the HCPV worldcumulative installed capacity in 2013 was 160 MWp and that thiscould exceed 1400 MWp in 2020 Based on the available informa-tion three different annual growth (QA in) scenarios of thiscapacity can be assumed as shown in Fig 3 a base case with agrowth of 30 (Conservative) a pessimistic case with a growth of27 (Low) and an optimistic case with a growth of 33(Accelerated)

Learning curves can be used to estimate the evolution of the ini-tial investment cost of HCPV systems for upcoming years Thesecurves described the cost reduction as a function of the accumu-lated experience in the manufacturing and in the use of a particulartechnology The learning curve of a HCPV system can be expressedas

HCPVI year frac14 HCPVI 2013Q HCPV year

Q HCPV2013

logeth1LRTHORN2

eth10THORN

where HCPVI year is the HCPV initial investment cost in the yearunder review HCPVI 2013 is the HCPV initial investment cost in

Table 7Learning ratio values of conventional PV as estimated by several authors [68ndash72]

AuthorDate Period of time analysed Region studied LR ()

Poponi2003 1976ndash2002 World 25Parente2002 1981ndash2000 World 23IEA2000 1976ndash1996 EU 21Harmon2000 1968ndash1998 World 20Poponi2003 1989ndash2002 World 20

Table 8Values of parameters for the estimation of the learning curve for the three scenariosconsidered

Factor Accelerated Conservative Low

Normalized-per-kWp initialinvestment cost [HCPVI 2013]kWp

1400eurokWp

1800eurokWp

2200eurokWp

Annual growth (QA) 33 30 27Learning rate (LR) 28 25 22

Fig 4 Learning curves of the normalized-per-kWp initial investment cost of HCPVsystems in different scenarios and of conventional PV systems Also the normal-ized-per-kWp initial investment cost of HCPV forecast conducted by the privatecompany GTM Research Inc [60]

Table 9Values of the factors assumed for the calculation of the LCOE in the future scenario(2020) for HCPV and conventional PV systems

Factors Case base values Units

HCPV Conventional PV

Annual yield According Fig 1 According (Eq (8)) kW h(kWp year)[HCPVI]kWp 700 eurokWp[HCPVAOM]kWp 28 eurokWp[PVAOM]kWp 20 eurokWprd 05 yearrOampM 22 yearT 30 i 22 d 448 il 4 4 Nl 20 20 yearsdec 8 8 N 30 years

Fig 5 Levelised cost of electricity of the HCP

DL Talavera et al Applied Energy 151 (2015) 49ndash59 55

2013 QHCPV year is the HCPV world cumulative installed capacity inthe year under review QHCPV 2013 is the HCPV world cumulativeinstalled capacity in 2013 and LR is the Learning Rate As was indi-cated in Table 3 the HCPV normalized-per-kWp initial investmentcost may be taken at 1800 eurokWp with a variation ranging from1400 to 2200 eurokWp

As can be seen in Table 7 the learning rate of conventional PVhas decreased with time as more experience in this technologyhas been gained This ratio has increased from a value of 25 inthe first stage of this technology (the seventies) until a currentvalue of 20 As mentioned HCPV technology is still in its firststages and therefore has a learning ratio varying from 22 to 28

Based on the data examined above three scenarios for the esti-mation of the learning curve of the initial investment cost of HCPVsystems should be considered Table 8 summarizes the values of

V systems in the future scenario (2020)

Fig 6 Sensitivity analysis on LCOE of the HCPV systems as a function of thenormalized-per-kWp initial investment cost for different values of the annual directnormal irradiation

Fig 7 Sensitivity analysis on LCOE of the HCPV systems as a function of thenormalized-per-kWp annual operation and maintenance cost for different value ofthe annual direct normal irradiation

Fig 8 Sensitivity analysis on LCOE of the HCPV systems as a function of thenominal discount rate for different values of the annual direct normal irradiation

56 DL Talavera et al Applied Energy 151 (2015) 49ndash59

the parameters for the estimation of the learning curves of eachscenario Also in order to compare the results with conventionalfixed PV technology a scenario with normalized-per-kWp initialinvestment cost [PVI]kWp of 1200 eurokWp in 2013 an annual growthof 8 and a learning rate of 8 is presented Fig 4 shows the resultsobtained for each of the cases examined and commented on Theseresults depend on multiple variables that can change over time andtherefore modify the data obtained However it is possible toexpect a future scenario in which the normalized-per-kWp initialinvestment cost of HCPV and conventional PV systems will beequal at a value ranging from 500 to 900 eurokWp

In this future scenario (the year 2020) the same normalized-per-kWp initial investment cost for conventional PV and HCPV sys-tems (700 eurokWp) has been considered together with the values ofthe factors shown in Table 9 the estimation of the levelised cost ofelectricity of HCPV and conventional PV systems in Spain The mapin Fig 5 shows the levelised cost of electricity of HCPV systems inthe future scenario As can be seen the area with the highest valuesof LCOE is located in the north of the map with a maximum valueof 0080 eurokW h (location number 3 Table 2) The area with thelowest values of LCOE is located in the south of the map with aminimum value of 0035 eurokW h (location number 1 Table 2)Furthermore there are also other locations with low values ofLCOE in the middle of the map with values of 0037 eurokW h (e glocation number 4 Table 2) and in the northeast of the map withvalues about 0040 eurokW h In this future scenario (2020) HCPVsystems with a DNI ranging from 2221 to 982 kW h(m2 year)can reach LCOE values ranging from 0035 to 0080 eurokW hrespectively

The value of the factors that are involved in the estimation ofthe LCOE of HCPV systems may change according to governmentsupport programmes and policies technology (the learning curvesand the economic scales) etc In order to analyse this in moredetail the study of the influence on the LCOE caused by the possi-ble change of the values of some of these factors has been carriedout In particular a sensitivity analysis regarding the influence ofthe normalized per-kWp initial investment cost ([HCPVI]kWp) thenormalized per-kWp annual operation and maintenance cost([HCPVAOM]kWp) and the nominal discount rate (d) has been con-ducted Figs 6ndash8 show the estimated LCOE of HCPV systems as afunction of the [HCPVI]kWp [HCPVAOM]kWp and d respectively fordifferent values of the annual direct normal irradiation It is impor-tant to mention that the rest of the factors involved in the estima-tion of the LCOE shown in each figure were kept constant at thevalues given in Table 9

Fig 6 shows the estimation of the LCOE as a function of the nor-malized-per-kWp initial investment cost for an annual direct

normal irradiation ranging from 1000 to 2200 kW hm2 This figureconsiders variations of the normalized-per-Wp initial investmentcost from 500 to 2200 eurokWp If the worst case is assumed([HCPVI]KWp = 2200 eurokWp and DNIA = 1000 kW hm2) the valueof the LCOE would be at around 0174 eurokW h On the other handif the best case is assumed ([CPVIN]kWp = 500 eurokWp and DNIA =2200 kW h(m2 year)) the value of the LCOE would be at around0030 eurokW h

Fig 7 shows the calculation of the LCOE as a function of the nor-malized per-kWp annual operation and maintenance cost of HCPVsystems for an annual direct normal irradiation ranging from 1000to 2200 kW hm2 If the worst case is assumed ([HCPVAOM]KWp =45 eurokWp and DNIA = 1000 kW h(m2 year)) the value of theLCOE would be at around 0098 eurokW h In contrast if the best caseis assumed ([HCPVAOM]kWp = 15 eurokWp and DNIA = 2200 kW h(m2 year)) the value of the LCOE would be at around 0028 eurokW h

Finally Fig 8 shows the calculation of the LCOE as a function ofthe nominal discount rate for the same values of the annual directnormal irradiation previously considered If the worst case isassumed (d = 8 and DNIA = 1000 kW h(m2 year)) the value ofthe LCOE would be at around 0101 eurokW h At the same time ifthe best case is assumed (d = 2 and DNIA = 2200 kW h(m2 year))the value of the LCOE would be at around 0031 eurokW h

The influence on the LCOE of HCPV systems of the variations ofthree different factors was conducted above It is also interestingto compare the influence of these factors on the estimated valueof the LCOE of HCPV systems To carry out this analysis the basecase of the future scenario (Table 9) and a typical DNIA of

Fig 9 Difference between the LCOE of HCPV and conventional PV systems in the future scenario analysed (2020)

DL Talavera et al Applied Energy 151 (2015) 49ndash59 57

1800 kW h(m2 year) were considered In this case the LCOE is0043 eurokW h At the same time the value of [HCPVI]kWp[HCPVAOM]KWp or d where varied a +20 respectively while the restof the factors involved in the analysis were kept constant Based onthis analysis a value of LCOE = 0046 eurokW h was obtained consid-ering the individual variation of [HCPVAOM]KWp or d and a valueof LCOE = 0048 eurokW h was obtained considering the individualvariation of [HCPVI]kWp Thus it can be concluded that LCOE has asimilar sensitivity to the variations of [HCPVAOM]KWp and d and dif-ferent and larger sensitivity to the variations of [HCPVI]kWp

Fig 9 shows the difference between the LCOE of HCPV and con-ventional PV systems in the future scenario examined in this paper(2020) The LCOE of both technologies has been estimated solvingthe equations and following the procedure outlined in Section 2together with the figures shown in Table 9 in a spreadsheet Theannual electricity yield by a conventional PV system with the pan-els optimally inclined over the horizontal and permanently ori-ented southward was estimated using Eq (8) considering aperformance ratio of 075 In Fig 9 positive values indicate thatthe LCOE of HCPV systems is higher than the LCOE of conventionalPV systems while negative values indicate that the LCOE of HCPVsystems is lower than the LCOE of conventional PV systems In thisfuture scenario (2020) the calculated LCOE of conventional PV sys-tems varies from 0037 to 0064 eurokW h for locations with a Hopt

from 2043 (location number 1 Table 2) to 1171 kW h(m2 year)(location number 3 Table 2) respectively The blue areas of themap located in the south middle and northeast of the map repre-sent locations where the LCOE of HCPV systems is lower than theLCOE of conventional PV systems (e g locations number 1 2 and4 Table 2) As can be seen there are a wide number of areas whereHCPV would be a more profitable technology from an economicpoint of view The green areas of the map represent locationswhere the values of the LCOE for HCPV and conventional PV

systems are the same which indicate that both technologies canrepresent a similar economic profitability Also there are a widenumber of areas where the LCOE of HCPV systems are higher thanthe LCOE of conventional PV systems (e g location number 3 and5 Table 2) in which conventional PV technology is a more prof-itable investment from an economic point of view These locationsare mainly located in the north of Spain and can be explained dueto the low annual direct normal irradiation levels which cause lowannual energy yields as shown in Fig 1

5 Conclusions

The economic feasibility of HCPV systems is increasingly beingevaluated using the levelised cost of electricity (LCOE) generationin order to be compared to other electricity generation technolo-gies This is vital in terms of industrial perspective in order to anal-yse the potential of this young technology In this paper an analysisof the LCOE of HCPV systems has been carried out in Spain Theresults obtained are shown in an innovative set of maps

According to the cost analysis HCPV systems at locationswith annual direct normal irradiation ranging from 2221 to982 kW h(m2 year) reached a LCOE ranging from 0081 up018 eurokW h in 2013 Also considering a positive market evaluationover the next few years In 2020 HCPV systems could reach a LCOEvalue ranging from 0035 to 0080 eurokW h from the maximum tominimum the annual direct normal irradiation values

Considering a future scenario in which the initial investmentcost for conventional PV and HCPV systems is the same it can bealso concluded that PV is not a more profitable technology thanHCPV for the whole of Spain -from an economic point of view-The selection of the technology for a specific location will mainlydepend on its annual direct and global irradiation In the case of

58 DL Talavera et al Applied Energy 151 (2015) 49ndash59

Spain an area located in the southwest and northeast where HCPVwould represent a more profitable investment and another arealocated in the north where conventional PV systems would be amore profitable investment It is also important to note thatalthough this analysis has been carried out for Spain this conclu-sion can be extended for other regions worldwide

Future owners and potential investors of HCPV systems demandvaluable information about the economic feasibility of their invest-ment so one aim of this document is to provide information aboutthe LCOE of HCPV systems with power higher than 1 MWpFurthermore Spanish governmental bodies which are involved inthe design or selection of the support mechanisms addressed toHCPV may be enlightened by the results of the present paper

Appendix A Terminology

[HCPVAOM]kWp

Normalized per-kWp annual operationand maintenance cost of the HCPV system(euro)

[HCPVI]kWp

Normalized per-kWp initial investmentcost of HCPV (eurokWp)

[PVAOM]kWp

Normalized per-kWp annual operationand maintenance cost of the PV system(euro)

[PVI]kWp

Normalized per-kWp initial investmentcost of PV (eurokWp)

d

Nominal discount rate ()

dec

Annual dividend the equity capital ndash

return on equityndash ()

DEP

Annual tax depreciation (euro)

DNIA

Annual Direct Normal Irradiation

(kW h(m2 year))

DNISTC

Direct Normal Irradiation in Standard Test

Condition (1 kW hm2)

GSTC

Global Irradiance in Standard Test

Condition (1 kWm2)

HCPVAOM

Annual operation and maintenance cost

of the HCPV system (euro)

HCPVec

Amount equal to the portion of the initial

investment financed with equity capital(euro)

HCPVI

Initial investment cost on the HCPVsystem (euro)

HCPVl

Amount equal to the portion of the initialinvestment financed with loan (euro)

Hopt A

Annual Global Irradiation on optimallyinclined plane (kW h(m2 year))

i

Annual inflation rate ()

il

Annual loan interest ()

LCC

Life cycle cost of the HCPV system (euro)

LCOE

Levelised cost of electricity (eurokW h)

LR

Learning rate

N

Life cycle of the HCPV system equal to

analysis period (years)

Nd

Tax life for depreciation (years)

Nl

Amortization of loan (years)

PR

Performance ratio ()

PW [DEP]

Present worth of the tax depreciation (euro)

PW [HCPVOM (N)]

Present worth of the HCPV system

operation and maintenance cost (euro)

q

Factor equal to (11 + d)

QHCPV

HCPV world cumulative installed capacity

QA

Annual growth installed capacity ()

rd

Annual degradation rate in the efficiencyof the HCPV panels ()

rOampM

Annual escalation rate of the operationand maintenance cost of the HCPV system()

SV

Salvage value of the system at the end oftheir life cycle (euro)

T

Income tax rate ()

WACC

Weighted Average Cost of Capital ()

YHCPV

Final AC annual energy yield in a HCPV

grid connected system (kW h(kWp year)

YPV

Final AC annual energy yield in a

conventional fixed FV grid connectedsystem kW h(kWp year)

References

[1] Muntildeoz E Vidal PG Nofuentes G Hontoria L Peacuterez-Higueras P Terrados J et alCPV standardization An overview Renew Sustain Energ Rev 201014518ndash23

[2] International Electrotechnical Commission IEC 62108 Concentratorphotovoltaic (CPV) modules and assemblies ndash design qualification and typeapproval Edition 10 Geneve 2007

[3] Globaldata Concentrated Photovoltaics (CPV) ndash Global market sizecompetitive landscape and key country analysis to 2020 UK 2014

[4] Fernaacutendez EF Peacuterez-Higueras P Garcia Loureiro AJ Vidal PG Outdoor evaluationof concentrator photovoltaic systems modules from different manufacturersFirst results and steps Prog Photovoltaics Res Appl 201321693ndash701

[5] Danchev S Maniatis G Tsakanikas A Returns on investment in electricityproducing photovoltaic systems under de-escalating feed-in tariffs The case ofGreece Renew Sustain Energy Rev 201014500ndash5

[6] Spertino F Di Leo P Cocina V Economic analysis of investment in the rooftopphotovoltaic systems A long-term research in the two main markets RenewSustain Energy Rev 201328531ndash40

[7] Talavera DL Muntildeoz-Ceroacuten E De La Casa J Ortega MJ Almonacid G Energy andeconomic analysis for large-scale integration of small photovoltaic systems inbuildings The case of a public location in Southern Spain Renew SustainEnergy Rev 2011154310ndash9

[8] Talavera DL de la Casa J Muntildeoz-Ceroacuten E Almonacid G Grid parity and self-consumption with photovoltaic systems under the present regulatoryframework in Spain The case of the University of Jaeacuten Campus RenewSustain Energy Rev 201433752ndash71

[9] Drury E Denholm P Margolis R The impact of different economic performancemetrics on the perceived value of solar photovoltaics October 2011 TechnicalReport NRELTP-6A20-52197

[10] Reddy KS Veershetty G Viability analysis of solar parabolic dish stand-alonepower plant for Indian conditions Appl Energy 2013102908ndash22

[11] Branker K Pathak MJM Pearce JM A review of solar photovoltaic levelized costof electricity Renew Sustain Energy Rev 2011154470ndash82

[12] Eclareon SL PV grid parity monitor residential sector 2nd issue May 2013 p40ndash2

[13] Fraunhofer institute for solar energy systems ISE Levelized cost of electricityrenewable energy technologies November 2013

[14] Fraisopi F The CPV market An industry perspective GTM Research IntersolarMuumlnchen June 2013

[15] Daniilidis A Herber R Vermaas DA Upscale potential and financial feasibilityof a reverse electrodialysis power plant Appl Energy 2014119257ndash65

[16] Goumlkccedilek M Genccedil MS Evaluation of electricity generation and energy cost ofwind energy conversion systems (WECSs) in Central Turkey Appl Energy2009862731ndash9

[17] Desideri U Campana PE Analysis and comparison between a concentratingsolar and a photovoltaic power plant Appl Energy 2014113422ndash33

[18] Hernaacutendez-Moro J Martiacutenez-Duart JM Analytical model for solar PV and CSPelectricity costs Present LCOE values and their future evolution RenewSustain Energy Rev 201320119ndash32

[19] International Renewable Energy Agency (IRENA) Renewable power generationcosts in 2012 An overview 2013 IRENA report ltwwwirenaorgPublicationsgt

[20] Short W Packey DJ Holt T A manual for the economic evaluation of energyefficiency and renewable energy technologies NRELTPndash462-5173 NationalRenewable Energy Laboratory 1995 p 1ndash120

[21] European photovoltaic industry association Solar photovoltaics competing inthe energy sector On the road to competitiveness 2011 lthttpwwwepiaorgnewspublicationsgt

[22] Swift KD A comparison of the cost and financial returns for solar photovoltaicsystems installed by businesses in different locations across the United StatesRenewable Energy 201357137ndash43

[23] Nishikawa Wea LCOE concentrating photovoltaic for CPV ICSC5 Conference2008

DL Talavera et al Applied Energy 151 (2015) 49ndash59 51

cost of capital (WACC) over the discounting factor (nominal dis-count rate) HCPVI (euro) is the initial investment cost of the HCPV sys-tem which may be financed through long-term debt andor equitycapital If HCPVI is financed through a loan (HCPVl) and equity cap-ital (HCPVec) so that HCPVI = HCPVl + HCPVec Therefore this can bewritten as

HCPVI frac14 HCPVl ileth1 TTHORN

1 1thorn ileth1 TTHORNeth THORNNl q eth1 qNl THORN

1 q

thorn ethdec HCPVecTHORN q eth1 qNTHORN

1 qthornHCPVec qN

eth7THORN

The first term of Eq (7) depicts the loan HCPVl is borrowed at anannual loan interest (il) to be repaid in Nl years The second termdepicts the equity capital with an annual payback in the form ofdividends (dec) and it is amortized at the end of the life cycle ofthe system It is worth mentioning that the left-hand side ofEq (7) only equals its right-hand side if the selected value of d isequal to the weighted average cost of capital (WACC) of theinvestment

WACC is the cost that the owner or investor of the project mustpay for the use of capital sources in order to finance the invest-ment A widespread practice in organizations is to use a nominaldiscount rate (d) equal to the organizationrsquos weighted average costof capital [20] In this paper nominal discount rate is assumed to beequal to WACC in order to calculate the LCOE

Table 1Values provided by some HCPV Companies concerning DNI yield and performanceratio

Companylocation DNIA

(kW hm2)YHCPV

(kW hkWp year)PR () Reference

SoitecTouwsrivier 2447 1878 76ndash81 [42]SolfocusISFOC 1861 1914 887 [34]MagPowerPortugal 1978 2113 91 [43]SempriusNREL 2446 2079 85 [44]Solar systems

Hermannsburg2464 2104 854 [40]

3 Estimation of parameters involved in the calculation LCOE

This review will lead to the identification of the value of theparameters for the analysis of the HCPV and conventional PV sys-tems for a scenario in the year 2013 and a future scenario In thisfuture scenario the value of the parameters for the analysis ofthe HCPV and conventional PV systems will have the same valuesexcept for the operation and maintenance costs and solar irradia-tion It should be noted that the figures presented here referringto costs and electricity yields are all normalized-per-kWp Thesymbols used for these factors are the same for those not normal-ized except that they are shown in brackets and with the subscriptlsquokWprsquo

31 Calculation of the HCPV electricity yields

There are different methods [2627] to calculate the energy gen-erated by a grid-connected photovoltaic system the method basedon the Performance Ratio (PR) being one of the most often usedAccording to the IEC standard 61724 [28] the year-round electric-ity generated by a conventional PV system with fixed panels opti-mally inclined over the horizontal and permanently orientedsouthward can be estimated using the following equation

YFV frac14 PRHopt A

GSTCeth8THORN

where YFV is the final AC annual energy yield in a conventional FVsystem (kW hkWp year) Hopt A is the annual global irradiation onoptimally inclined plane (kW hm2 year) and GSTC is the global irra-diance at standard test condition (1 kWm2)

The value of PR in a conventional PV system usually ranges from070 to 080 In this case we have used a value of 075 based onexperience of this kind of system [29ndash33]

The annual electricity generated by a HCPV system can be esti-mated using the following equation

YHCPV frac14 PRDNIA

DNISTCeth9THORN

where YHCPV is the final AC annual energy yield in a HCPV system(kW hkWp year) DNIA is the annual direct normal irradiation(kW hm2 year) and DNISTC is the direct normal irradiance at stan-dard test condition (1 kWm2)

The value of PR in a typical HCPV system ranges from 076 to091 [34ndash44] as shown in Table 1 Based on the analysis of thesedata an intermediate value of PR = 082 has been considered forthis study

Fig 1 shows the final AC annual energy yield of a typical HCPVsystem in Spain It has been obtained from Eq (9) using a spatiallydistributed estimate of DNIA and assuming a constant PR value of082 DNIA was evaluated following the approach described in[24] which is briefly outlined in the following using the WeatherResearch and Forecasting (WRF) numerical weather predictionmodel [45] Since release v36 the WRF model can output DNI[4647] being probably the first model of its class with this addedcapability The entire area of Spain was simulated at a spatial reso-lution of 10 km for the period from January 2003 to December 2012The modelrsquos DNI outputs were annually aggregated and averagedover the 10-year period to obtain the map of DNIA Using this timescale a data assimilation process was conducted to correct DNIA

based on the annual DNI measured at the more than 50 radiometricstations of the National Radiometric Network of the SpanishNational Weather Service The data assimilation process ensuresan average a DNI estimate with negligible bias and uncertainty ofonly 5 with respect to the ground observations As can be seenin Fig 1 the available DNIA depends highly on the location of inter-est thus being a source of strong spatial variability of the final ACannual yield of a HCPV system installed in the study region Theavailable normal direct irradiation depends highly on the locationof the site and is a crucial factor for the calculation of the final ACelectricity annual yield of an HCPV system In this map a bluecoloured area located in the north can be seen showing the lowestelectricity annual yield with a minimum value of 805 kW h(kWp year) (location number 3 Table 2) The area with the highestelectricity annual yield is located in the south of the map with amaximum value of 1821 kW h(kWp year) (location number 1Table 2) Furthermore there are high values of electricity annualyield in locations in the middle and northeast of the map for exam-ple of 1743 kW h(kWp year) (location number 4 Table 2)

Table 2 shows the values of annual irradiation Yield and LCOEof five locations with the following characteristics Location num-ber 1 presents the highest value of DNIA Location number 2 has amedium value of DNIA Location number 3 presents the minimumvalue of DNIA Location number 4 has the maximum differencebetween DNIA and Hopt and Location number 5 has the minimumdifference between DNIA and Hopt These values will be discussedin future sections

32 Estimation of remaining factors involved in the analysis

According to the parameters described in the previous sectionsthe typical normalized-per kWp initial investment cost in HCPV orconventional PV systems are shown in Table 3

Fig 1 Annual electricity yields in Spain produced by a 1-kWp HCPV system (kW hkWpyear) with performance ratio equal to 082

Table 2Irradiation yield and LCOE values for different Spanish locations

Number Location Latitude Longitude DNIA

(kW h(m year))Hopt

(kW h(m2 year))YHCPV

(kW h(kWp year))YPV

(kW h(kWp year))LCOEHCPV (eurokW h)Scenario

2013 2020

1 Granada 3743 322 2221 2043 1821 1532 0081 0035 DNI maximum2 Cuenca 3990 196 1960 1868 1607 1401 0092 0040 DNI median3 Cantabria 4309 437 982 1171 805 878 0184 0080 DNI minimum4 Toledo 3993 535 2126 1904 1743 1428 0085 0037 (DNIndashHopt) maximum5 Burgos 4309 374 1044 1249 856 937 0173 0075 (DNIndashHopt) minimum

Table 3Installed system prices for 2013 (Sources Conventional PV systems [48] HCPVsystems [1314])

Power (gt1 MW) Conventional PV HCPV Units

Normalized-per-kWpinitial investment cost

1000ndash1400 1400ndash2200 eurokWp

52 DL Talavera et al Applied Energy 151 (2015) 49ndash59

Regarding the inflation rate (i) reviewing the averages of histor-ical data for Spain in the period 2007ndash2013 [49ndash52] a value for theinflation rate equal to 22 can be assumed see also Table 4

Table 4Average rate of inflation in the period 2007ndash2013

Year 2007 2008 2009 2010 20

Annual average rateof inflation ()

28 41 02 20 3128 41 03 18 3228 41 02 21 31

Initial investment cost may be financed by means of debt andorequity capital Long-term loans and equity capital have beenselected in this paper It has been assumed that 80 of this amountis borrowed as a loan ndash debt while the remaining investmentamount 20 is contributed from equity capital Regarding the con-ventional PV systems the loan il is considered equal to 4 Nl equalto 20 years [5354] while equity capital dec equal to 8 [13] beingamortized at the end of the life cycle of the system for PVConcerning the HCPV the loan il is considered equal to 6 Nl equalto 20 years while the equity capital dec equal to 12 and beingamortized at the end of the life-cycle of the system HCPV projects

11 2012 2013 Average rate of Inflation(2007ndash2013) ()

Reference

24 15 224 [51]24 14 220 [52]24 15 226 [50]

DL Talavera et al Applied Energy 151 (2015) 49ndash59 53

have a risk higher than conventional PV system so return onequity capital (dec) and cost of the loan (il) are higher values

The income tax rate (T) for the organization or taxpayerchanges depending on each countryrsquos regulations The value ofincome tax rate is assumed equal to 30 for this study The methodused in the tax depreciation have been based on a general methodusing a maximum linear coefficient of 5 with a tax life for depre-ciation of 20 years [5556]

The annual HCPV electricity yield generated by the system isassumed to decrease every year Annual degradation rate (rd) inthe efficiency of the PV panels is 05year [1157] The analysisperiod is equal to the life time of the HCPV system thereforeN = 30 years Nowadays conventional PV systems have a life cycleof around 30 years and more Salvage value of the system at theend of their life-cycle (SV) is taken as equal to zero

The nominal discount rate (d) is assumed equal to the weightedaverage cost of capital in order to calculate the LCOE [1320] This

Table 5Values of the factors assumed for the calculation of LCOE on HCPV systems in thescenario for 2013

Factors Case base values Units

YHCPV According Fig 1 kW h(kWp year)[HCPVI]kWp 1800 eurokWp[HCPVAOM]kWp 28 eurokWprd 05 yearrOampM 22 yearT 30 i 22 d 649 il 6 Nl 20 yearsdec 12 N 30 years

Fig 2 LCOE for HCPV systems in S

capital cost will vary depending on how the capital resources arechosen to finance the initial investment cost The after-tax WACCvalues are shown in Tables 5 and 9

Normalized-per-kWp annual operation and maintenance costsare estimated to be 20 eurokW year for the conventional PV systems[485818] Meanwhile normalized-per-kWp annual operation andmaintenance cost is taken at 28 eurokW year for the HCPV systems[1458] Annual escalation rate of the operation and maintenancecost (rOampM) is set equal to the value of the annual inflation rateso rOampM = 22 for both systems

To summarise the figures selected and assumed for each of thefactors that define the case base for the HCPV systems are shown inTable 4 while Table 8 shows the figures for the case base of con-ventional PV systems and HCPV systems in the future scenarioSolving the equations presented in Section 2 together with the fig-ures shown Tables 5 and 9 in a spreadsheet paves the way to theestimation of the LCOE for each of the scenarios

4 Analysis and results

In this section the levelised cost of electricity of HCPV technol-ogy in Spain has been estimated This study has taken solar irradi-ation according to the area selected geographically while theremaining parameters involved in the analysis were kept constantFurthermore the results obtained in this analysis have been shownin innovative maps

41 Levelised cost of electricity of HCPV

Solving the equations and following the procedure presented inSection 2 using the values provided in Table 5 and the annual HCPVelectricity yields of Fig 1 the LCOE for HCPV systems in Spain inthe year 2013 has been estimated

pain in the scenario for 2013

Fig 3 Forecast of the HCPV world cumulative capacity based on the three scenariosconsidered Low Conservative and Accelerated Market forecast conducted by theprivate companies IHS (HIS) Globaldata (GD) and SPV Market (SPV)

54 DL Talavera et al Applied Energy 151 (2015) 49ndash59

Fig 2 represents the levelised cost of electricity of HCPV sys-tems larger than 1 MWp and assuming a system performance ratio082 for 2013 In Fig 2 all data values are given as eurokW h As can beseen the area with the highest values of LCOE is located in thenorth of the map with a maximum value of 0184 eurokW h (locationnumber 3 Table 2) The area with the lowest values of LCOE islocated in the south of the map with a minimum value of0081 eurokW h (location number 1 Table 2) Furthermore thereare also other locations with low values of LCOE in the middle ofthe map with values of 0085 eurokW h (eg location number 4Table 2) and in the northeast of the map with values around0089 eurokW h In this scenario HCPV systems with a DNIA rangingfrom 2221 to 982 kW h(m2 year) can reach LCOE values rangingfrom 0081 to 0184 eurokW h respectively

The validation of the results obtained is difficult since there areno studies concerning the analysis of the LCOE of HCPV systems inSpain However in order to validate the results found Table 6shows the values of LCOE obtained for similar technologies andscenarios for different organizations It is important to note thatalthough similar the scenarios and inputs for the estimation ofthe LCOE are not the same Because of this different results areexpected However as can be seen the values of LCOE obtainedin this work are similar to those presented by other authors Forexample the study performed by Fraunhofer ISE analyses locationswhose DNIA range from 2000 to 2500 kW h(m2 year) and the val-ues of LCOE obtained range from 008 to 015 eurokW h These resultsare almost equal to those obtained in this study with values ofLCOE ranging from 008 to 018 eurokW h (the values are slightlyhigher since the DNIA in Spain varies from 1000 to 2200 kW h(m2 -year)) Also Solfocus Inc [59] estimates a LCOE of 008 eurokW h forlsquolsquoVictor Valley Collegersquorsquo power plant located in Victorville CA (USA)with an DNI of 2628 kW(m2 year) and GTM Research Inc [60] esti-mates a LCOE of 007 eurokW h for a power plant located in PhoenixAZ (USA) with an DNI of 2518 kW(m2 year) Hence it can be con-sidered that the results found here are accurate and are represen-tative of HCPV systems located in Spain

42 Comparison between the LCOE of HCPV and conventional PVsystems

The forecasting of the evolution of the market for a new tech-nology is a complex issue mainly due to the lack of historical dataand because of the rapid advances that occur in the first stages ofdevelopment In addition this evolution will be dependent onother factors such as the economic crisis and the support programsimplemented by several countries Because of this a reduction inthe manufacturing costs of the solar cells and the introduction oflow cost materials for manufacturing new optical devices areexpected in the next few years These will bring important indus-trial growth and consolidation in the manufacturing of HCPVmodules

HCPV technology has two main advantages when comparedwith other sources of energy [63] Firstly the high potential costreduction because of the reduction of expensive semiconductormaterials by cheaper optical devices The other main advantagesof HCPV compared with conventional PV technology are that the

Table 6LCOE for 2013 using the exchange rate 1euro = 136$ [136162]

Technology Organization LCOE (eurokW h)

Conventional PV EPIA 009ndash019Conventional PV IEA 012ndash016Conventional PV Fraunhofer ISE 007ndash010HCPV Fraunhofer ISE 008ndash015HCPV University of Jaeacuten 008ndash018

distribution of costs in a HCPV system has a wider spectrum thecost of cells not having such an important influence on the globalcost The result is that a great part of the system cost is transferredfrom the cells to other more varied and readily available technolo-gies leaving room in projects and investments from other very dif-ferent industrial sectors that can easily be adapted to manufacturethese new products (plastic glass metal mechanical industriesetc) The high efficiency of the elements of HCPV implies a reduc-tion of the area required for these systems leading to a substantialdecrease both in the investment and the price of the electricitygenerated Concentration cells have reached an in lab maximumefficiency of 44 [64] Therefore concentration modules are beingmanufactured with about 30ndash35 [65] efficiencies and the resultsof the measurements performed to the already installed HCPV sys-tems show values that double the efficiencies of the conventionalPV systems

Several market analyses [36667] indicate that the HCPV worldcumulative installed capacity in 2013 was 160 MWp and that thiscould exceed 1400 MWp in 2020 Based on the available informa-tion three different annual growth (QA in) scenarios of thiscapacity can be assumed as shown in Fig 3 a base case with agrowth of 30 (Conservative) a pessimistic case with a growth of27 (Low) and an optimistic case with a growth of 33(Accelerated)

Learning curves can be used to estimate the evolution of the ini-tial investment cost of HCPV systems for upcoming years Thesecurves described the cost reduction as a function of the accumu-lated experience in the manufacturing and in the use of a particulartechnology The learning curve of a HCPV system can be expressedas

HCPVI year frac14 HCPVI 2013Q HCPV year

Q HCPV2013

logeth1LRTHORN2

eth10THORN

where HCPVI year is the HCPV initial investment cost in the yearunder review HCPVI 2013 is the HCPV initial investment cost in

Table 7Learning ratio values of conventional PV as estimated by several authors [68ndash72]

AuthorDate Period of time analysed Region studied LR ()

Poponi2003 1976ndash2002 World 25Parente2002 1981ndash2000 World 23IEA2000 1976ndash1996 EU 21Harmon2000 1968ndash1998 World 20Poponi2003 1989ndash2002 World 20

Table 8Values of parameters for the estimation of the learning curve for the three scenariosconsidered

Factor Accelerated Conservative Low

Normalized-per-kWp initialinvestment cost [HCPVI 2013]kWp

1400eurokWp

1800eurokWp

2200eurokWp

Annual growth (QA) 33 30 27Learning rate (LR) 28 25 22

Fig 4 Learning curves of the normalized-per-kWp initial investment cost of HCPVsystems in different scenarios and of conventional PV systems Also the normal-ized-per-kWp initial investment cost of HCPV forecast conducted by the privatecompany GTM Research Inc [60]

Table 9Values of the factors assumed for the calculation of the LCOE in the future scenario(2020) for HCPV and conventional PV systems

Factors Case base values Units

HCPV Conventional PV

Annual yield According Fig 1 According (Eq (8)) kW h(kWp year)[HCPVI]kWp 700 eurokWp[HCPVAOM]kWp 28 eurokWp[PVAOM]kWp 20 eurokWprd 05 yearrOampM 22 yearT 30 i 22 d 448 il 4 4 Nl 20 20 yearsdec 8 8 N 30 years

Fig 5 Levelised cost of electricity of the HCP

DL Talavera et al Applied Energy 151 (2015) 49ndash59 55

2013 QHCPV year is the HCPV world cumulative installed capacity inthe year under review QHCPV 2013 is the HCPV world cumulativeinstalled capacity in 2013 and LR is the Learning Rate As was indi-cated in Table 3 the HCPV normalized-per-kWp initial investmentcost may be taken at 1800 eurokWp with a variation ranging from1400 to 2200 eurokWp

As can be seen in Table 7 the learning rate of conventional PVhas decreased with time as more experience in this technologyhas been gained This ratio has increased from a value of 25 inthe first stage of this technology (the seventies) until a currentvalue of 20 As mentioned HCPV technology is still in its firststages and therefore has a learning ratio varying from 22 to 28

Based on the data examined above three scenarios for the esti-mation of the learning curve of the initial investment cost of HCPVsystems should be considered Table 8 summarizes the values of

V systems in the future scenario (2020)

Fig 6 Sensitivity analysis on LCOE of the HCPV systems as a function of thenormalized-per-kWp initial investment cost for different values of the annual directnormal irradiation

Fig 7 Sensitivity analysis on LCOE of the HCPV systems as a function of thenormalized-per-kWp annual operation and maintenance cost for different value ofthe annual direct normal irradiation

Fig 8 Sensitivity analysis on LCOE of the HCPV systems as a function of thenominal discount rate for different values of the annual direct normal irradiation

56 DL Talavera et al Applied Energy 151 (2015) 49ndash59

the parameters for the estimation of the learning curves of eachscenario Also in order to compare the results with conventionalfixed PV technology a scenario with normalized-per-kWp initialinvestment cost [PVI]kWp of 1200 eurokWp in 2013 an annual growthof 8 and a learning rate of 8 is presented Fig 4 shows the resultsobtained for each of the cases examined and commented on Theseresults depend on multiple variables that can change over time andtherefore modify the data obtained However it is possible toexpect a future scenario in which the normalized-per-kWp initialinvestment cost of HCPV and conventional PV systems will beequal at a value ranging from 500 to 900 eurokWp

In this future scenario (the year 2020) the same normalized-per-kWp initial investment cost for conventional PV and HCPV sys-tems (700 eurokWp) has been considered together with the values ofthe factors shown in Table 9 the estimation of the levelised cost ofelectricity of HCPV and conventional PV systems in Spain The mapin Fig 5 shows the levelised cost of electricity of HCPV systems inthe future scenario As can be seen the area with the highest valuesof LCOE is located in the north of the map with a maximum valueof 0080 eurokW h (location number 3 Table 2) The area with thelowest values of LCOE is located in the south of the map with aminimum value of 0035 eurokW h (location number 1 Table 2)Furthermore there are also other locations with low values ofLCOE in the middle of the map with values of 0037 eurokW h (e glocation number 4 Table 2) and in the northeast of the map withvalues about 0040 eurokW h In this future scenario (2020) HCPVsystems with a DNI ranging from 2221 to 982 kW h(m2 year)can reach LCOE values ranging from 0035 to 0080 eurokW hrespectively

The value of the factors that are involved in the estimation ofthe LCOE of HCPV systems may change according to governmentsupport programmes and policies technology (the learning curvesand the economic scales) etc In order to analyse this in moredetail the study of the influence on the LCOE caused by the possi-ble change of the values of some of these factors has been carriedout In particular a sensitivity analysis regarding the influence ofthe normalized per-kWp initial investment cost ([HCPVI]kWp) thenormalized per-kWp annual operation and maintenance cost([HCPVAOM]kWp) and the nominal discount rate (d) has been con-ducted Figs 6ndash8 show the estimated LCOE of HCPV systems as afunction of the [HCPVI]kWp [HCPVAOM]kWp and d respectively fordifferent values of the annual direct normal irradiation It is impor-tant to mention that the rest of the factors involved in the estima-tion of the LCOE shown in each figure were kept constant at thevalues given in Table 9

Fig 6 shows the estimation of the LCOE as a function of the nor-malized-per-kWp initial investment cost for an annual direct

normal irradiation ranging from 1000 to 2200 kW hm2 This figureconsiders variations of the normalized-per-Wp initial investmentcost from 500 to 2200 eurokWp If the worst case is assumed([HCPVI]KWp = 2200 eurokWp and DNIA = 1000 kW hm2) the valueof the LCOE would be at around 0174 eurokW h On the other handif the best case is assumed ([CPVIN]kWp = 500 eurokWp and DNIA =2200 kW h(m2 year)) the value of the LCOE would be at around0030 eurokW h

Fig 7 shows the calculation of the LCOE as a function of the nor-malized per-kWp annual operation and maintenance cost of HCPVsystems for an annual direct normal irradiation ranging from 1000to 2200 kW hm2 If the worst case is assumed ([HCPVAOM]KWp =45 eurokWp and DNIA = 1000 kW h(m2 year)) the value of theLCOE would be at around 0098 eurokW h In contrast if the best caseis assumed ([HCPVAOM]kWp = 15 eurokWp and DNIA = 2200 kW h(m2 year)) the value of the LCOE would be at around 0028 eurokW h

Finally Fig 8 shows the calculation of the LCOE as a function ofthe nominal discount rate for the same values of the annual directnormal irradiation previously considered If the worst case isassumed (d = 8 and DNIA = 1000 kW h(m2 year)) the value ofthe LCOE would be at around 0101 eurokW h At the same time ifthe best case is assumed (d = 2 and DNIA = 2200 kW h(m2 year))the value of the LCOE would be at around 0031 eurokW h

The influence on the LCOE of HCPV systems of the variations ofthree different factors was conducted above It is also interestingto compare the influence of these factors on the estimated valueof the LCOE of HCPV systems To carry out this analysis the basecase of the future scenario (Table 9) and a typical DNIA of

Fig 9 Difference between the LCOE of HCPV and conventional PV systems in the future scenario analysed (2020)

DL Talavera et al Applied Energy 151 (2015) 49ndash59 57

1800 kW h(m2 year) were considered In this case the LCOE is0043 eurokW h At the same time the value of [HCPVI]kWp[HCPVAOM]KWp or d where varied a +20 respectively while the restof the factors involved in the analysis were kept constant Based onthis analysis a value of LCOE = 0046 eurokW h was obtained consid-ering the individual variation of [HCPVAOM]KWp or d and a valueof LCOE = 0048 eurokW h was obtained considering the individualvariation of [HCPVI]kWp Thus it can be concluded that LCOE has asimilar sensitivity to the variations of [HCPVAOM]KWp and d and dif-ferent and larger sensitivity to the variations of [HCPVI]kWp

Fig 9 shows the difference between the LCOE of HCPV and con-ventional PV systems in the future scenario examined in this paper(2020) The LCOE of both technologies has been estimated solvingthe equations and following the procedure outlined in Section 2together with the figures shown in Table 9 in a spreadsheet Theannual electricity yield by a conventional PV system with the pan-els optimally inclined over the horizontal and permanently ori-ented southward was estimated using Eq (8) considering aperformance ratio of 075 In Fig 9 positive values indicate thatthe LCOE of HCPV systems is higher than the LCOE of conventionalPV systems while negative values indicate that the LCOE of HCPVsystems is lower than the LCOE of conventional PV systems In thisfuture scenario (2020) the calculated LCOE of conventional PV sys-tems varies from 0037 to 0064 eurokW h for locations with a Hopt

from 2043 (location number 1 Table 2) to 1171 kW h(m2 year)(location number 3 Table 2) respectively The blue areas of themap located in the south middle and northeast of the map repre-sent locations where the LCOE of HCPV systems is lower than theLCOE of conventional PV systems (e g locations number 1 2 and4 Table 2) As can be seen there are a wide number of areas whereHCPV would be a more profitable technology from an economicpoint of view The green areas of the map represent locationswhere the values of the LCOE for HCPV and conventional PV

systems are the same which indicate that both technologies canrepresent a similar economic profitability Also there are a widenumber of areas where the LCOE of HCPV systems are higher thanthe LCOE of conventional PV systems (e g location number 3 and5 Table 2) in which conventional PV technology is a more prof-itable investment from an economic point of view These locationsare mainly located in the north of Spain and can be explained dueto the low annual direct normal irradiation levels which cause lowannual energy yields as shown in Fig 1

5 Conclusions

The economic feasibility of HCPV systems is increasingly beingevaluated using the levelised cost of electricity (LCOE) generationin order to be compared to other electricity generation technolo-gies This is vital in terms of industrial perspective in order to anal-yse the potential of this young technology In this paper an analysisof the LCOE of HCPV systems has been carried out in Spain Theresults obtained are shown in an innovative set of maps

According to the cost analysis HCPV systems at locationswith annual direct normal irradiation ranging from 2221 to982 kW h(m2 year) reached a LCOE ranging from 0081 up018 eurokW h in 2013 Also considering a positive market evaluationover the next few years In 2020 HCPV systems could reach a LCOEvalue ranging from 0035 to 0080 eurokW h from the maximum tominimum the annual direct normal irradiation values

Considering a future scenario in which the initial investmentcost for conventional PV and HCPV systems is the same it can bealso concluded that PV is not a more profitable technology thanHCPV for the whole of Spain -from an economic point of view-The selection of the technology for a specific location will mainlydepend on its annual direct and global irradiation In the case of

58 DL Talavera et al Applied Energy 151 (2015) 49ndash59

Spain an area located in the southwest and northeast where HCPVwould represent a more profitable investment and another arealocated in the north where conventional PV systems would be amore profitable investment It is also important to note thatalthough this analysis has been carried out for Spain this conclu-sion can be extended for other regions worldwide

Future owners and potential investors of HCPV systems demandvaluable information about the economic feasibility of their invest-ment so one aim of this document is to provide information aboutthe LCOE of HCPV systems with power higher than 1 MWpFurthermore Spanish governmental bodies which are involved inthe design or selection of the support mechanisms addressed toHCPV may be enlightened by the results of the present paper

Appendix A Terminology

[HCPVAOM]kWp

Normalized per-kWp annual operationand maintenance cost of the HCPV system(euro)

[HCPVI]kWp

Normalized per-kWp initial investmentcost of HCPV (eurokWp)

[PVAOM]kWp

Normalized per-kWp annual operationand maintenance cost of the PV system(euro)

[PVI]kWp

Normalized per-kWp initial investmentcost of PV (eurokWp)

d

Nominal discount rate ()

dec

Annual dividend the equity capital ndash

return on equityndash ()

DEP

Annual tax depreciation (euro)

DNIA

Annual Direct Normal Irradiation

(kW h(m2 year))

DNISTC

Direct Normal Irradiation in Standard Test

Condition (1 kW hm2)

GSTC

Global Irradiance in Standard Test

Condition (1 kWm2)

HCPVAOM

Annual operation and maintenance cost

of the HCPV system (euro)

HCPVec

Amount equal to the portion of the initial

investment financed with equity capital(euro)

HCPVI

Initial investment cost on the HCPVsystem (euro)

HCPVl

Amount equal to the portion of the initialinvestment financed with loan (euro)

Hopt A

Annual Global Irradiation on optimallyinclined plane (kW h(m2 year))

i

Annual inflation rate ()

il

Annual loan interest ()

LCC

Life cycle cost of the HCPV system (euro)

LCOE

Levelised cost of electricity (eurokW h)

LR

Learning rate

N

Life cycle of the HCPV system equal to

analysis period (years)

Nd

Tax life for depreciation (years)

Nl

Amortization of loan (years)

PR

Performance ratio ()

PW [DEP]

Present worth of the tax depreciation (euro)

PW [HCPVOM (N)]

Present worth of the HCPV system

operation and maintenance cost (euro)

q

Factor equal to (11 + d)

QHCPV

HCPV world cumulative installed capacity

QA

Annual growth installed capacity ()

rd

Annual degradation rate in the efficiencyof the HCPV panels ()

rOampM

Annual escalation rate of the operationand maintenance cost of the HCPV system()

SV

Salvage value of the system at the end oftheir life cycle (euro)

T

Income tax rate ()

WACC

Weighted Average Cost of Capital ()

YHCPV

Final AC annual energy yield in a HCPV

grid connected system (kW h(kWp year)

YPV

Final AC annual energy yield in a

conventional fixed FV grid connectedsystem kW h(kWp year)

References

[1] Muntildeoz E Vidal PG Nofuentes G Hontoria L Peacuterez-Higueras P Terrados J et alCPV standardization An overview Renew Sustain Energ Rev 201014518ndash23

[2] International Electrotechnical Commission IEC 62108 Concentratorphotovoltaic (CPV) modules and assemblies ndash design qualification and typeapproval Edition 10 Geneve 2007

[3] Globaldata Concentrated Photovoltaics (CPV) ndash Global market sizecompetitive landscape and key country analysis to 2020 UK 2014

[4] Fernaacutendez EF Peacuterez-Higueras P Garcia Loureiro AJ Vidal PG Outdoor evaluationof concentrator photovoltaic systems modules from different manufacturersFirst results and steps Prog Photovoltaics Res Appl 201321693ndash701

[5] Danchev S Maniatis G Tsakanikas A Returns on investment in electricityproducing photovoltaic systems under de-escalating feed-in tariffs The case ofGreece Renew Sustain Energy Rev 201014500ndash5

[6] Spertino F Di Leo P Cocina V Economic analysis of investment in the rooftopphotovoltaic systems A long-term research in the two main markets RenewSustain Energy Rev 201328531ndash40

[7] Talavera DL Muntildeoz-Ceroacuten E De La Casa J Ortega MJ Almonacid G Energy andeconomic analysis for large-scale integration of small photovoltaic systems inbuildings The case of a public location in Southern Spain Renew SustainEnergy Rev 2011154310ndash9

[8] Talavera DL de la Casa J Muntildeoz-Ceroacuten E Almonacid G Grid parity and self-consumption with photovoltaic systems under the present regulatoryframework in Spain The case of the University of Jaeacuten Campus RenewSustain Energy Rev 201433752ndash71

[9] Drury E Denholm P Margolis R The impact of different economic performancemetrics on the perceived value of solar photovoltaics October 2011 TechnicalReport NRELTP-6A20-52197

[10] Reddy KS Veershetty G Viability analysis of solar parabolic dish stand-alonepower plant for Indian conditions Appl Energy 2013102908ndash22

[11] Branker K Pathak MJM Pearce JM A review of solar photovoltaic levelized costof electricity Renew Sustain Energy Rev 2011154470ndash82

[12] Eclareon SL PV grid parity monitor residential sector 2nd issue May 2013 p40ndash2

[13] Fraunhofer institute for solar energy systems ISE Levelized cost of electricityrenewable energy technologies November 2013

[14] Fraisopi F The CPV market An industry perspective GTM Research IntersolarMuumlnchen June 2013

[15] Daniilidis A Herber R Vermaas DA Upscale potential and financial feasibilityof a reverse electrodialysis power plant Appl Energy 2014119257ndash65

[16] Goumlkccedilek M Genccedil MS Evaluation of electricity generation and energy cost ofwind energy conversion systems (WECSs) in Central Turkey Appl Energy2009862731ndash9

[17] Desideri U Campana PE Analysis and comparison between a concentratingsolar and a photovoltaic power plant Appl Energy 2014113422ndash33

[18] Hernaacutendez-Moro J Martiacutenez-Duart JM Analytical model for solar PV and CSPelectricity costs Present LCOE values and their future evolution RenewSustain Energy Rev 201320119ndash32

[19] International Renewable Energy Agency (IRENA) Renewable power generationcosts in 2012 An overview 2013 IRENA report ltwwwirenaorgPublicationsgt

[20] Short W Packey DJ Holt T A manual for the economic evaluation of energyefficiency and renewable energy technologies NRELTPndash462-5173 NationalRenewable Energy Laboratory 1995 p 1ndash120

[21] European photovoltaic industry association Solar photovoltaics competing inthe energy sector On the road to competitiveness 2011 lthttpwwwepiaorgnewspublicationsgt

[22] Swift KD A comparison of the cost and financial returns for solar photovoltaicsystems installed by businesses in different locations across the United StatesRenewable Energy 201357137ndash43

[23] Nishikawa Wea LCOE concentrating photovoltaic for CPV ICSC5 Conference2008

Fig 1 Annual electricity yields in Spain produced by a 1-kWp HCPV system (kW hkWpyear) with performance ratio equal to 082

Table 2Irradiation yield and LCOE values for different Spanish locations

Number Location Latitude Longitude DNIA

(kW h(m year))Hopt

(kW h(m2 year))YHCPV

(kW h(kWp year))YPV

(kW h(kWp year))LCOEHCPV (eurokW h)Scenario

2013 2020

1 Granada 3743 322 2221 2043 1821 1532 0081 0035 DNI maximum2 Cuenca 3990 196 1960 1868 1607 1401 0092 0040 DNI median3 Cantabria 4309 437 982 1171 805 878 0184 0080 DNI minimum4 Toledo 3993 535 2126 1904 1743 1428 0085 0037 (DNIndashHopt) maximum5 Burgos 4309 374 1044 1249 856 937 0173 0075 (DNIndashHopt) minimum

Table 3Installed system prices for 2013 (Sources Conventional PV systems [48] HCPVsystems [1314])

Power (gt1 MW) Conventional PV HCPV Units

Normalized-per-kWpinitial investment cost

1000ndash1400 1400ndash2200 eurokWp

52 DL Talavera et al Applied Energy 151 (2015) 49ndash59

Regarding the inflation rate (i) reviewing the averages of histor-ical data for Spain in the period 2007ndash2013 [49ndash52] a value for theinflation rate equal to 22 can be assumed see also Table 4

Table 4Average rate of inflation in the period 2007ndash2013

Year 2007 2008 2009 2010 20

Annual average rateof inflation ()

28 41 02 20 3128 41 03 18 3228 41 02 21 31

Initial investment cost may be financed by means of debt andorequity capital Long-term loans and equity capital have beenselected in this paper It has been assumed that 80 of this amountis borrowed as a loan ndash debt while the remaining investmentamount 20 is contributed from equity capital Regarding the con-ventional PV systems the loan il is considered equal to 4 Nl equalto 20 years [5354] while equity capital dec equal to 8 [13] beingamortized at the end of the life cycle of the system for PVConcerning the HCPV the loan il is considered equal to 6 Nl equalto 20 years while the equity capital dec equal to 12 and beingamortized at the end of the life-cycle of the system HCPV projects

11 2012 2013 Average rate of Inflation(2007ndash2013) ()

Reference

24 15 224 [51]24 14 220 [52]24 15 226 [50]

DL Talavera et al Applied Energy 151 (2015) 49ndash59 53

have a risk higher than conventional PV system so return onequity capital (dec) and cost of the loan (il) are higher values

The income tax rate (T) for the organization or taxpayerchanges depending on each countryrsquos regulations The value ofincome tax rate is assumed equal to 30 for this study The methodused in the tax depreciation have been based on a general methodusing a maximum linear coefficient of 5 with a tax life for depre-ciation of 20 years [5556]

The annual HCPV electricity yield generated by the system isassumed to decrease every year Annual degradation rate (rd) inthe efficiency of the PV panels is 05year [1157] The analysisperiod is equal to the life time of the HCPV system thereforeN = 30 years Nowadays conventional PV systems have a life cycleof around 30 years and more Salvage value of the system at theend of their life-cycle (SV) is taken as equal to zero

The nominal discount rate (d) is assumed equal to the weightedaverage cost of capital in order to calculate the LCOE [1320] This

Table 5Values of the factors assumed for the calculation of LCOE on HCPV systems in thescenario for 2013

Factors Case base values Units

YHCPV According Fig 1 kW h(kWp year)[HCPVI]kWp 1800 eurokWp[HCPVAOM]kWp 28 eurokWprd 05 yearrOampM 22 yearT 30 i 22 d 649 il 6 Nl 20 yearsdec 12 N 30 years

Fig 2 LCOE for HCPV systems in S

capital cost will vary depending on how the capital resources arechosen to finance the initial investment cost The after-tax WACCvalues are shown in Tables 5 and 9

Normalized-per-kWp annual operation and maintenance costsare estimated to be 20 eurokW year for the conventional PV systems[485818] Meanwhile normalized-per-kWp annual operation andmaintenance cost is taken at 28 eurokW year for the HCPV systems[1458] Annual escalation rate of the operation and maintenancecost (rOampM) is set equal to the value of the annual inflation rateso rOampM = 22 for both systems

To summarise the figures selected and assumed for each of thefactors that define the case base for the HCPV systems are shown inTable 4 while Table 8 shows the figures for the case base of con-ventional PV systems and HCPV systems in the future scenarioSolving the equations presented in Section 2 together with the fig-ures shown Tables 5 and 9 in a spreadsheet paves the way to theestimation of the LCOE for each of the scenarios

4 Analysis and results

In this section the levelised cost of electricity of HCPV technol-ogy in Spain has been estimated This study has taken solar irradi-ation according to the area selected geographically while theremaining parameters involved in the analysis were kept constantFurthermore the results obtained in this analysis have been shownin innovative maps

41 Levelised cost of electricity of HCPV

Solving the equations and following the procedure presented inSection 2 using the values provided in Table 5 and the annual HCPVelectricity yields of Fig 1 the LCOE for HCPV systems in Spain inthe year 2013 has been estimated

pain in the scenario for 2013

Fig 3 Forecast of the HCPV world cumulative capacity based on the three scenariosconsidered Low Conservative and Accelerated Market forecast conducted by theprivate companies IHS (HIS) Globaldata (GD) and SPV Market (SPV)

54 DL Talavera et al Applied Energy 151 (2015) 49ndash59

Fig 2 represents the levelised cost of electricity of HCPV sys-tems larger than 1 MWp and assuming a system performance ratio082 for 2013 In Fig 2 all data values are given as eurokW h As can beseen the area with the highest values of LCOE is located in thenorth of the map with a maximum value of 0184 eurokW h (locationnumber 3 Table 2) The area with the lowest values of LCOE islocated in the south of the map with a minimum value of0081 eurokW h (location number 1 Table 2) Furthermore thereare also other locations with low values of LCOE in the middle ofthe map with values of 0085 eurokW h (eg location number 4Table 2) and in the northeast of the map with values around0089 eurokW h In this scenario HCPV systems with a DNIA rangingfrom 2221 to 982 kW h(m2 year) can reach LCOE values rangingfrom 0081 to 0184 eurokW h respectively

The validation of the results obtained is difficult since there areno studies concerning the analysis of the LCOE of HCPV systems inSpain However in order to validate the results found Table 6shows the values of LCOE obtained for similar technologies andscenarios for different organizations It is important to note thatalthough similar the scenarios and inputs for the estimation ofthe LCOE are not the same Because of this different results areexpected However as can be seen the values of LCOE obtainedin this work are similar to those presented by other authors Forexample the study performed by Fraunhofer ISE analyses locationswhose DNIA range from 2000 to 2500 kW h(m2 year) and the val-ues of LCOE obtained range from 008 to 015 eurokW h These resultsare almost equal to those obtained in this study with values ofLCOE ranging from 008 to 018 eurokW h (the values are slightlyhigher since the DNIA in Spain varies from 1000 to 2200 kW h(m2 -year)) Also Solfocus Inc [59] estimates a LCOE of 008 eurokW h forlsquolsquoVictor Valley Collegersquorsquo power plant located in Victorville CA (USA)with an DNI of 2628 kW(m2 year) and GTM Research Inc [60] esti-mates a LCOE of 007 eurokW h for a power plant located in PhoenixAZ (USA) with an DNI of 2518 kW(m2 year) Hence it can be con-sidered that the results found here are accurate and are represen-tative of HCPV systems located in Spain

42 Comparison between the LCOE of HCPV and conventional PVsystems

The forecasting of the evolution of the market for a new tech-nology is a complex issue mainly due to the lack of historical dataand because of the rapid advances that occur in the first stages ofdevelopment In addition this evolution will be dependent onother factors such as the economic crisis and the support programsimplemented by several countries Because of this a reduction inthe manufacturing costs of the solar cells and the introduction oflow cost materials for manufacturing new optical devices areexpected in the next few years These will bring important indus-trial growth and consolidation in the manufacturing of HCPVmodules

HCPV technology has two main advantages when comparedwith other sources of energy [63] Firstly the high potential costreduction because of the reduction of expensive semiconductormaterials by cheaper optical devices The other main advantagesof HCPV compared with conventional PV technology are that the

Table 6LCOE for 2013 using the exchange rate 1euro = 136$ [136162]

Technology Organization LCOE (eurokW h)

Conventional PV EPIA 009ndash019Conventional PV IEA 012ndash016Conventional PV Fraunhofer ISE 007ndash010HCPV Fraunhofer ISE 008ndash015HCPV University of Jaeacuten 008ndash018

distribution of costs in a HCPV system has a wider spectrum thecost of cells not having such an important influence on the globalcost The result is that a great part of the system cost is transferredfrom the cells to other more varied and readily available technolo-gies leaving room in projects and investments from other very dif-ferent industrial sectors that can easily be adapted to manufacturethese new products (plastic glass metal mechanical industriesetc) The high efficiency of the elements of HCPV implies a reduc-tion of the area required for these systems leading to a substantialdecrease both in the investment and the price of the electricitygenerated Concentration cells have reached an in lab maximumefficiency of 44 [64] Therefore concentration modules are beingmanufactured with about 30ndash35 [65] efficiencies and the resultsof the measurements performed to the already installed HCPV sys-tems show values that double the efficiencies of the conventionalPV systems

Several market analyses [36667] indicate that the HCPV worldcumulative installed capacity in 2013 was 160 MWp and that thiscould exceed 1400 MWp in 2020 Based on the available informa-tion three different annual growth (QA in) scenarios of thiscapacity can be assumed as shown in Fig 3 a base case with agrowth of 30 (Conservative) a pessimistic case with a growth of27 (Low) and an optimistic case with a growth of 33(Accelerated)

Learning curves can be used to estimate the evolution of the ini-tial investment cost of HCPV systems for upcoming years Thesecurves described the cost reduction as a function of the accumu-lated experience in the manufacturing and in the use of a particulartechnology The learning curve of a HCPV system can be expressedas

HCPVI year frac14 HCPVI 2013Q HCPV year

Q HCPV2013

logeth1LRTHORN2

eth10THORN

where HCPVI year is the HCPV initial investment cost in the yearunder review HCPVI 2013 is the HCPV initial investment cost in

Table 7Learning ratio values of conventional PV as estimated by several authors [68ndash72]

AuthorDate Period of time analysed Region studied LR ()

Poponi2003 1976ndash2002 World 25Parente2002 1981ndash2000 World 23IEA2000 1976ndash1996 EU 21Harmon2000 1968ndash1998 World 20Poponi2003 1989ndash2002 World 20

Table 8Values of parameters for the estimation of the learning curve for the three scenariosconsidered

Factor Accelerated Conservative Low

Normalized-per-kWp initialinvestment cost [HCPVI 2013]kWp

1400eurokWp

1800eurokWp

2200eurokWp

Annual growth (QA) 33 30 27Learning rate (LR) 28 25 22

Fig 4 Learning curves of the normalized-per-kWp initial investment cost of HCPVsystems in different scenarios and of conventional PV systems Also the normal-ized-per-kWp initial investment cost of HCPV forecast conducted by the privatecompany GTM Research Inc [60]

Table 9Values of the factors assumed for the calculation of the LCOE in the future scenario(2020) for HCPV and conventional PV systems

Factors Case base values Units

HCPV Conventional PV

Annual yield According Fig 1 According (Eq (8)) kW h(kWp year)[HCPVI]kWp 700 eurokWp[HCPVAOM]kWp 28 eurokWp[PVAOM]kWp 20 eurokWprd 05 yearrOampM 22 yearT 30 i 22 d 448 il 4 4 Nl 20 20 yearsdec 8 8 N 30 years

Fig 5 Levelised cost of electricity of the HCP

DL Talavera et al Applied Energy 151 (2015) 49ndash59 55

2013 QHCPV year is the HCPV world cumulative installed capacity inthe year under review QHCPV 2013 is the HCPV world cumulativeinstalled capacity in 2013 and LR is the Learning Rate As was indi-cated in Table 3 the HCPV normalized-per-kWp initial investmentcost may be taken at 1800 eurokWp with a variation ranging from1400 to 2200 eurokWp

As can be seen in Table 7 the learning rate of conventional PVhas decreased with time as more experience in this technologyhas been gained This ratio has increased from a value of 25 inthe first stage of this technology (the seventies) until a currentvalue of 20 As mentioned HCPV technology is still in its firststages and therefore has a learning ratio varying from 22 to 28

Based on the data examined above three scenarios for the esti-mation of the learning curve of the initial investment cost of HCPVsystems should be considered Table 8 summarizes the values of

V systems in the future scenario (2020)

Fig 6 Sensitivity analysis on LCOE of the HCPV systems as a function of thenormalized-per-kWp initial investment cost for different values of the annual directnormal irradiation

Fig 7 Sensitivity analysis on LCOE of the HCPV systems as a function of thenormalized-per-kWp annual operation and maintenance cost for different value ofthe annual direct normal irradiation

Fig 8 Sensitivity analysis on LCOE of the HCPV systems as a function of thenominal discount rate for different values of the annual direct normal irradiation

56 DL Talavera et al Applied Energy 151 (2015) 49ndash59

the parameters for the estimation of the learning curves of eachscenario Also in order to compare the results with conventionalfixed PV technology a scenario with normalized-per-kWp initialinvestment cost [PVI]kWp of 1200 eurokWp in 2013 an annual growthof 8 and a learning rate of 8 is presented Fig 4 shows the resultsobtained for each of the cases examined and commented on Theseresults depend on multiple variables that can change over time andtherefore modify the data obtained However it is possible toexpect a future scenario in which the normalized-per-kWp initialinvestment cost of HCPV and conventional PV systems will beequal at a value ranging from 500 to 900 eurokWp

In this future scenario (the year 2020) the same normalized-per-kWp initial investment cost for conventional PV and HCPV sys-tems (700 eurokWp) has been considered together with the values ofthe factors shown in Table 9 the estimation of the levelised cost ofelectricity of HCPV and conventional PV systems in Spain The mapin Fig 5 shows the levelised cost of electricity of HCPV systems inthe future scenario As can be seen the area with the highest valuesof LCOE is located in the north of the map with a maximum valueof 0080 eurokW h (location number 3 Table 2) The area with thelowest values of LCOE is located in the south of the map with aminimum value of 0035 eurokW h (location number 1 Table 2)Furthermore there are also other locations with low values ofLCOE in the middle of the map with values of 0037 eurokW h (e glocation number 4 Table 2) and in the northeast of the map withvalues about 0040 eurokW h In this future scenario (2020) HCPVsystems with a DNI ranging from 2221 to 982 kW h(m2 year)can reach LCOE values ranging from 0035 to 0080 eurokW hrespectively

The value of the factors that are involved in the estimation ofthe LCOE of HCPV systems may change according to governmentsupport programmes and policies technology (the learning curvesand the economic scales) etc In order to analyse this in moredetail the study of the influence on the LCOE caused by the possi-ble change of the values of some of these factors has been carriedout In particular a sensitivity analysis regarding the influence ofthe normalized per-kWp initial investment cost ([HCPVI]kWp) thenormalized per-kWp annual operation and maintenance cost([HCPVAOM]kWp) and the nominal discount rate (d) has been con-ducted Figs 6ndash8 show the estimated LCOE of HCPV systems as afunction of the [HCPVI]kWp [HCPVAOM]kWp and d respectively fordifferent values of the annual direct normal irradiation It is impor-tant to mention that the rest of the factors involved in the estima-tion of the LCOE shown in each figure were kept constant at thevalues given in Table 9

Fig 6 shows the estimation of the LCOE as a function of the nor-malized-per-kWp initial investment cost for an annual direct

normal irradiation ranging from 1000 to 2200 kW hm2 This figureconsiders variations of the normalized-per-Wp initial investmentcost from 500 to 2200 eurokWp If the worst case is assumed([HCPVI]KWp = 2200 eurokWp and DNIA = 1000 kW hm2) the valueof the LCOE would be at around 0174 eurokW h On the other handif the best case is assumed ([CPVIN]kWp = 500 eurokWp and DNIA =2200 kW h(m2 year)) the value of the LCOE would be at around0030 eurokW h

Fig 7 shows the calculation of the LCOE as a function of the nor-malized per-kWp annual operation and maintenance cost of HCPVsystems for an annual direct normal irradiation ranging from 1000to 2200 kW hm2 If the worst case is assumed ([HCPVAOM]KWp =45 eurokWp and DNIA = 1000 kW h(m2 year)) the value of theLCOE would be at around 0098 eurokW h In contrast if the best caseis assumed ([HCPVAOM]kWp = 15 eurokWp and DNIA = 2200 kW h(m2 year)) the value of the LCOE would be at around 0028 eurokW h

Finally Fig 8 shows the calculation of the LCOE as a function ofthe nominal discount rate for the same values of the annual directnormal irradiation previously considered If the worst case isassumed (d = 8 and DNIA = 1000 kW h(m2 year)) the value ofthe LCOE would be at around 0101 eurokW h At the same time ifthe best case is assumed (d = 2 and DNIA = 2200 kW h(m2 year))the value of the LCOE would be at around 0031 eurokW h

The influence on the LCOE of HCPV systems of the variations ofthree different factors was conducted above It is also interestingto compare the influence of these factors on the estimated valueof the LCOE of HCPV systems To carry out this analysis the basecase of the future scenario (Table 9) and a typical DNIA of

Fig 9 Difference between the LCOE of HCPV and conventional PV systems in the future scenario analysed (2020)

DL Talavera et al Applied Energy 151 (2015) 49ndash59 57

1800 kW h(m2 year) were considered In this case the LCOE is0043 eurokW h At the same time the value of [HCPVI]kWp[HCPVAOM]KWp or d where varied a +20 respectively while the restof the factors involved in the analysis were kept constant Based onthis analysis a value of LCOE = 0046 eurokW h was obtained consid-ering the individual variation of [HCPVAOM]KWp or d and a valueof LCOE = 0048 eurokW h was obtained considering the individualvariation of [HCPVI]kWp Thus it can be concluded that LCOE has asimilar sensitivity to the variations of [HCPVAOM]KWp and d and dif-ferent and larger sensitivity to the variations of [HCPVI]kWp

Fig 9 shows the difference between the LCOE of HCPV and con-ventional PV systems in the future scenario examined in this paper(2020) The LCOE of both technologies has been estimated solvingthe equations and following the procedure outlined in Section 2together with the figures shown in Table 9 in a spreadsheet Theannual electricity yield by a conventional PV system with the pan-els optimally inclined over the horizontal and permanently ori-ented southward was estimated using Eq (8) considering aperformance ratio of 075 In Fig 9 positive values indicate thatthe LCOE of HCPV systems is higher than the LCOE of conventionalPV systems while negative values indicate that the LCOE of HCPVsystems is lower than the LCOE of conventional PV systems In thisfuture scenario (2020) the calculated LCOE of conventional PV sys-tems varies from 0037 to 0064 eurokW h for locations with a Hopt

from 2043 (location number 1 Table 2) to 1171 kW h(m2 year)(location number 3 Table 2) respectively The blue areas of themap located in the south middle and northeast of the map repre-sent locations where the LCOE of HCPV systems is lower than theLCOE of conventional PV systems (e g locations number 1 2 and4 Table 2) As can be seen there are a wide number of areas whereHCPV would be a more profitable technology from an economicpoint of view The green areas of the map represent locationswhere the values of the LCOE for HCPV and conventional PV

systems are the same which indicate that both technologies canrepresent a similar economic profitability Also there are a widenumber of areas where the LCOE of HCPV systems are higher thanthe LCOE of conventional PV systems (e g location number 3 and5 Table 2) in which conventional PV technology is a more prof-itable investment from an economic point of view These locationsare mainly located in the north of Spain and can be explained dueto the low annual direct normal irradiation levels which cause lowannual energy yields as shown in Fig 1

5 Conclusions

The economic feasibility of HCPV systems is increasingly beingevaluated using the levelised cost of electricity (LCOE) generationin order to be compared to other electricity generation technolo-gies This is vital in terms of industrial perspective in order to anal-yse the potential of this young technology In this paper an analysisof the LCOE of HCPV systems has been carried out in Spain Theresults obtained are shown in an innovative set of maps

According to the cost analysis HCPV systems at locationswith annual direct normal irradiation ranging from 2221 to982 kW h(m2 year) reached a LCOE ranging from 0081 up018 eurokW h in 2013 Also considering a positive market evaluationover the next few years In 2020 HCPV systems could reach a LCOEvalue ranging from 0035 to 0080 eurokW h from the maximum tominimum the annual direct normal irradiation values

Considering a future scenario in which the initial investmentcost for conventional PV and HCPV systems is the same it can bealso concluded that PV is not a more profitable technology thanHCPV for the whole of Spain -from an economic point of view-The selection of the technology for a specific location will mainlydepend on its annual direct and global irradiation In the case of

58 DL Talavera et al Applied Energy 151 (2015) 49ndash59

Spain an area located in the southwest and northeast where HCPVwould represent a more profitable investment and another arealocated in the north where conventional PV systems would be amore profitable investment It is also important to note thatalthough this analysis has been carried out for Spain this conclu-sion can be extended for other regions worldwide

Future owners and potential investors of HCPV systems demandvaluable information about the economic feasibility of their invest-ment so one aim of this document is to provide information aboutthe LCOE of HCPV systems with power higher than 1 MWpFurthermore Spanish governmental bodies which are involved inthe design or selection of the support mechanisms addressed toHCPV may be enlightened by the results of the present paper

Appendix A Terminology

[HCPVAOM]kWp

Normalized per-kWp annual operationand maintenance cost of the HCPV system(euro)

[HCPVI]kWp

Normalized per-kWp initial investmentcost of HCPV (eurokWp)

[PVAOM]kWp

Normalized per-kWp annual operationand maintenance cost of the PV system(euro)

[PVI]kWp

Normalized per-kWp initial investmentcost of PV (eurokWp)

d

Nominal discount rate ()

dec

Annual dividend the equity capital ndash

return on equityndash ()

DEP

Annual tax depreciation (euro)

DNIA

Annual Direct Normal Irradiation

(kW h(m2 year))

DNISTC

Direct Normal Irradiation in Standard Test

Condition (1 kW hm2)

GSTC

Global Irradiance in Standard Test

Condition (1 kWm2)

HCPVAOM

Annual operation and maintenance cost

of the HCPV system (euro)

HCPVec

Amount equal to the portion of the initial

investment financed with equity capital(euro)

HCPVI

Initial investment cost on the HCPVsystem (euro)

HCPVl

Amount equal to the portion of the initialinvestment financed with loan (euro)

Hopt A

Annual Global Irradiation on optimallyinclined plane (kW h(m2 year))

i

Annual inflation rate ()

il

Annual loan interest ()

LCC

Life cycle cost of the HCPV system (euro)

LCOE

Levelised cost of electricity (eurokW h)

LR

Learning rate

N

Life cycle of the HCPV system equal to

analysis period (years)

Nd

Tax life for depreciation (years)

Nl

Amortization of loan (years)

PR

Performance ratio ()

PW [DEP]

Present worth of the tax depreciation (euro)

PW [HCPVOM (N)]

Present worth of the HCPV system

operation and maintenance cost (euro)

q

Factor equal to (11 + d)

QHCPV

HCPV world cumulative installed capacity

QA

Annual growth installed capacity ()

rd

Annual degradation rate in the efficiencyof the HCPV panels ()

rOampM

Annual escalation rate of the operationand maintenance cost of the HCPV system()

SV

Salvage value of the system at the end oftheir life cycle (euro)

T

Income tax rate ()

WACC

Weighted Average Cost of Capital ()

YHCPV

Final AC annual energy yield in a HCPV

grid connected system (kW h(kWp year)

YPV

Final AC annual energy yield in a

conventional fixed FV grid connectedsystem kW h(kWp year)

References

[1] Muntildeoz E Vidal PG Nofuentes G Hontoria L Peacuterez-Higueras P Terrados J et alCPV standardization An overview Renew Sustain Energ Rev 201014518ndash23

[2] International Electrotechnical Commission IEC 62108 Concentratorphotovoltaic (CPV) modules and assemblies ndash design qualification and typeapproval Edition 10 Geneve 2007

[3] Globaldata Concentrated Photovoltaics (CPV) ndash Global market sizecompetitive landscape and key country analysis to 2020 UK 2014

[4] Fernaacutendez EF Peacuterez-Higueras P Garcia Loureiro AJ Vidal PG Outdoor evaluationof concentrator photovoltaic systems modules from different manufacturersFirst results and steps Prog Photovoltaics Res Appl 201321693ndash701

[5] Danchev S Maniatis G Tsakanikas A Returns on investment in electricityproducing photovoltaic systems under de-escalating feed-in tariffs The case ofGreece Renew Sustain Energy Rev 201014500ndash5

[6] Spertino F Di Leo P Cocina V Economic analysis of investment in the rooftopphotovoltaic systems A long-term research in the two main markets RenewSustain Energy Rev 201328531ndash40

[7] Talavera DL Muntildeoz-Ceroacuten E De La Casa J Ortega MJ Almonacid G Energy andeconomic analysis for large-scale integration of small photovoltaic systems inbuildings The case of a public location in Southern Spain Renew SustainEnergy Rev 2011154310ndash9

[8] Talavera DL de la Casa J Muntildeoz-Ceroacuten E Almonacid G Grid parity and self-consumption with photovoltaic systems under the present regulatoryframework in Spain The case of the University of Jaeacuten Campus RenewSustain Energy Rev 201433752ndash71

[9] Drury E Denholm P Margolis R The impact of different economic performancemetrics on the perceived value of solar photovoltaics October 2011 TechnicalReport NRELTP-6A20-52197

[10] Reddy KS Veershetty G Viability analysis of solar parabolic dish stand-alonepower plant for Indian conditions Appl Energy 2013102908ndash22

[11] Branker K Pathak MJM Pearce JM A review of solar photovoltaic levelized costof electricity Renew Sustain Energy Rev 2011154470ndash82

[12] Eclareon SL PV grid parity monitor residential sector 2nd issue May 2013 p40ndash2

[13] Fraunhofer institute for solar energy systems ISE Levelized cost of electricityrenewable energy technologies November 2013

[14] Fraisopi F The CPV market An industry perspective GTM Research IntersolarMuumlnchen June 2013

[15] Daniilidis A Herber R Vermaas DA Upscale potential and financial feasibilityof a reverse electrodialysis power plant Appl Energy 2014119257ndash65

[16] Goumlkccedilek M Genccedil MS Evaluation of electricity generation and energy cost ofwind energy conversion systems (WECSs) in Central Turkey Appl Energy2009862731ndash9

[17] Desideri U Campana PE Analysis and comparison between a concentratingsolar and a photovoltaic power plant Appl Energy 2014113422ndash33

[18] Hernaacutendez-Moro J Martiacutenez-Duart JM Analytical model for solar PV and CSPelectricity costs Present LCOE values and their future evolution RenewSustain Energy Rev 201320119ndash32

[19] International Renewable Energy Agency (IRENA) Renewable power generationcosts in 2012 An overview 2013 IRENA report ltwwwirenaorgPublicationsgt

[20] Short W Packey DJ Holt T A manual for the economic evaluation of energyefficiency and renewable energy technologies NRELTPndash462-5173 NationalRenewable Energy Laboratory 1995 p 1ndash120

[21] European photovoltaic industry association Solar photovoltaics competing inthe energy sector On the road to competitiveness 2011 lthttpwwwepiaorgnewspublicationsgt

[22] Swift KD A comparison of the cost and financial returns for solar photovoltaicsystems installed by businesses in different locations across the United StatesRenewable Energy 201357137ndash43

[23] Nishikawa Wea LCOE concentrating photovoltaic for CPV ICSC5 Conference2008

DL Talavera et al Applied Energy 151 (2015) 49ndash59 53

have a risk higher than conventional PV system so return onequity capital (dec) and cost of the loan (il) are higher values

The income tax rate (T) for the organization or taxpayerchanges depending on each countryrsquos regulations The value ofincome tax rate is assumed equal to 30 for this study The methodused in the tax depreciation have been based on a general methodusing a maximum linear coefficient of 5 with a tax life for depre-ciation of 20 years [5556]

The annual HCPV electricity yield generated by the system isassumed to decrease every year Annual degradation rate (rd) inthe efficiency of the PV panels is 05year [1157] The analysisperiod is equal to the life time of the HCPV system thereforeN = 30 years Nowadays conventional PV systems have a life cycleof around 30 years and more Salvage value of the system at theend of their life-cycle (SV) is taken as equal to zero

The nominal discount rate (d) is assumed equal to the weightedaverage cost of capital in order to calculate the LCOE [1320] This

Table 5Values of the factors assumed for the calculation of LCOE on HCPV systems in thescenario for 2013

Factors Case base values Units

YHCPV According Fig 1 kW h(kWp year)[HCPVI]kWp 1800 eurokWp[HCPVAOM]kWp 28 eurokWprd 05 yearrOampM 22 yearT 30 i 22 d 649 il 6 Nl 20 yearsdec 12 N 30 years

Fig 2 LCOE for HCPV systems in S

capital cost will vary depending on how the capital resources arechosen to finance the initial investment cost The after-tax WACCvalues are shown in Tables 5 and 9

Normalized-per-kWp annual operation and maintenance costsare estimated to be 20 eurokW year for the conventional PV systems[485818] Meanwhile normalized-per-kWp annual operation andmaintenance cost is taken at 28 eurokW year for the HCPV systems[1458] Annual escalation rate of the operation and maintenancecost (rOampM) is set equal to the value of the annual inflation rateso rOampM = 22 for both systems

To summarise the figures selected and assumed for each of thefactors that define the case base for the HCPV systems are shown inTable 4 while Table 8 shows the figures for the case base of con-ventional PV systems and HCPV systems in the future scenarioSolving the equations presented in Section 2 together with the fig-ures shown Tables 5 and 9 in a spreadsheet paves the way to theestimation of the LCOE for each of the scenarios

4 Analysis and results

In this section the levelised cost of electricity of HCPV technol-ogy in Spain has been estimated This study has taken solar irradi-ation according to the area selected geographically while theremaining parameters involved in the analysis were kept constantFurthermore the results obtained in this analysis have been shownin innovative maps

41 Levelised cost of electricity of HCPV

Solving the equations and following the procedure presented inSection 2 using the values provided in Table 5 and the annual HCPVelectricity yields of Fig 1 the LCOE for HCPV systems in Spain inthe year 2013 has been estimated

pain in the scenario for 2013

Fig 3 Forecast of the HCPV world cumulative capacity based on the three scenariosconsidered Low Conservative and Accelerated Market forecast conducted by theprivate companies IHS (HIS) Globaldata (GD) and SPV Market (SPV)

54 DL Talavera et al Applied Energy 151 (2015) 49ndash59

Fig 2 represents the levelised cost of electricity of HCPV sys-tems larger than 1 MWp and assuming a system performance ratio082 for 2013 In Fig 2 all data values are given as eurokW h As can beseen the area with the highest values of LCOE is located in thenorth of the map with a maximum value of 0184 eurokW h (locationnumber 3 Table 2) The area with the lowest values of LCOE islocated in the south of the map with a minimum value of0081 eurokW h (location number 1 Table 2) Furthermore thereare also other locations with low values of LCOE in the middle ofthe map with values of 0085 eurokW h (eg location number 4Table 2) and in the northeast of the map with values around0089 eurokW h In this scenario HCPV systems with a DNIA rangingfrom 2221 to 982 kW h(m2 year) can reach LCOE values rangingfrom 0081 to 0184 eurokW h respectively

The validation of the results obtained is difficult since there areno studies concerning the analysis of the LCOE of HCPV systems inSpain However in order to validate the results found Table 6shows the values of LCOE obtained for similar technologies andscenarios for different organizations It is important to note thatalthough similar the scenarios and inputs for the estimation ofthe LCOE are not the same Because of this different results areexpected However as can be seen the values of LCOE obtainedin this work are similar to those presented by other authors Forexample the study performed by Fraunhofer ISE analyses locationswhose DNIA range from 2000 to 2500 kW h(m2 year) and the val-ues of LCOE obtained range from 008 to 015 eurokW h These resultsare almost equal to those obtained in this study with values ofLCOE ranging from 008 to 018 eurokW h (the values are slightlyhigher since the DNIA in Spain varies from 1000 to 2200 kW h(m2 -year)) Also Solfocus Inc [59] estimates a LCOE of 008 eurokW h forlsquolsquoVictor Valley Collegersquorsquo power plant located in Victorville CA (USA)with an DNI of 2628 kW(m2 year) and GTM Research Inc [60] esti-mates a LCOE of 007 eurokW h for a power plant located in PhoenixAZ (USA) with an DNI of 2518 kW(m2 year) Hence it can be con-sidered that the results found here are accurate and are represen-tative of HCPV systems located in Spain

42 Comparison between the LCOE of HCPV and conventional PVsystems

The forecasting of the evolution of the market for a new tech-nology is a complex issue mainly due to the lack of historical dataand because of the rapid advances that occur in the first stages ofdevelopment In addition this evolution will be dependent onother factors such as the economic crisis and the support programsimplemented by several countries Because of this a reduction inthe manufacturing costs of the solar cells and the introduction oflow cost materials for manufacturing new optical devices areexpected in the next few years These will bring important indus-trial growth and consolidation in the manufacturing of HCPVmodules

HCPV technology has two main advantages when comparedwith other sources of energy [63] Firstly the high potential costreduction because of the reduction of expensive semiconductormaterials by cheaper optical devices The other main advantagesof HCPV compared with conventional PV technology are that the

Table 6LCOE for 2013 using the exchange rate 1euro = 136$ [136162]

Technology Organization LCOE (eurokW h)

Conventional PV EPIA 009ndash019Conventional PV IEA 012ndash016Conventional PV Fraunhofer ISE 007ndash010HCPV Fraunhofer ISE 008ndash015HCPV University of Jaeacuten 008ndash018

distribution of costs in a HCPV system has a wider spectrum thecost of cells not having such an important influence on the globalcost The result is that a great part of the system cost is transferredfrom the cells to other more varied and readily available technolo-gies leaving room in projects and investments from other very dif-ferent industrial sectors that can easily be adapted to manufacturethese new products (plastic glass metal mechanical industriesetc) The high efficiency of the elements of HCPV implies a reduc-tion of the area required for these systems leading to a substantialdecrease both in the investment and the price of the electricitygenerated Concentration cells have reached an in lab maximumefficiency of 44 [64] Therefore concentration modules are beingmanufactured with about 30ndash35 [65] efficiencies and the resultsof the measurements performed to the already installed HCPV sys-tems show values that double the efficiencies of the conventionalPV systems

Several market analyses [36667] indicate that the HCPV worldcumulative installed capacity in 2013 was 160 MWp and that thiscould exceed 1400 MWp in 2020 Based on the available informa-tion three different annual growth (QA in) scenarios of thiscapacity can be assumed as shown in Fig 3 a base case with agrowth of 30 (Conservative) a pessimistic case with a growth of27 (Low) and an optimistic case with a growth of 33(Accelerated)

Learning curves can be used to estimate the evolution of the ini-tial investment cost of HCPV systems for upcoming years Thesecurves described the cost reduction as a function of the accumu-lated experience in the manufacturing and in the use of a particulartechnology The learning curve of a HCPV system can be expressedas

HCPVI year frac14 HCPVI 2013Q HCPV year

Q HCPV2013

logeth1LRTHORN2

eth10THORN

where HCPVI year is the HCPV initial investment cost in the yearunder review HCPVI 2013 is the HCPV initial investment cost in

Table 7Learning ratio values of conventional PV as estimated by several authors [68ndash72]

AuthorDate Period of time analysed Region studied LR ()

Poponi2003 1976ndash2002 World 25Parente2002 1981ndash2000 World 23IEA2000 1976ndash1996 EU 21Harmon2000 1968ndash1998 World 20Poponi2003 1989ndash2002 World 20

Table 8Values of parameters for the estimation of the learning curve for the three scenariosconsidered

Factor Accelerated Conservative Low

Normalized-per-kWp initialinvestment cost [HCPVI 2013]kWp

1400eurokWp

1800eurokWp

2200eurokWp

Annual growth (QA) 33 30 27Learning rate (LR) 28 25 22

Fig 4 Learning curves of the normalized-per-kWp initial investment cost of HCPVsystems in different scenarios and of conventional PV systems Also the normal-ized-per-kWp initial investment cost of HCPV forecast conducted by the privatecompany GTM Research Inc [60]

Table 9Values of the factors assumed for the calculation of the LCOE in the future scenario(2020) for HCPV and conventional PV systems

Factors Case base values Units

HCPV Conventional PV

Annual yield According Fig 1 According (Eq (8)) kW h(kWp year)[HCPVI]kWp 700 eurokWp[HCPVAOM]kWp 28 eurokWp[PVAOM]kWp 20 eurokWprd 05 yearrOampM 22 yearT 30 i 22 d 448 il 4 4 Nl 20 20 yearsdec 8 8 N 30 years

Fig 5 Levelised cost of electricity of the HCP

DL Talavera et al Applied Energy 151 (2015) 49ndash59 55

2013 QHCPV year is the HCPV world cumulative installed capacity inthe year under review QHCPV 2013 is the HCPV world cumulativeinstalled capacity in 2013 and LR is the Learning Rate As was indi-cated in Table 3 the HCPV normalized-per-kWp initial investmentcost may be taken at 1800 eurokWp with a variation ranging from1400 to 2200 eurokWp

As can be seen in Table 7 the learning rate of conventional PVhas decreased with time as more experience in this technologyhas been gained This ratio has increased from a value of 25 inthe first stage of this technology (the seventies) until a currentvalue of 20 As mentioned HCPV technology is still in its firststages and therefore has a learning ratio varying from 22 to 28

Based on the data examined above three scenarios for the esti-mation of the learning curve of the initial investment cost of HCPVsystems should be considered Table 8 summarizes the values of

V systems in the future scenario (2020)

Fig 6 Sensitivity analysis on LCOE of the HCPV systems as a function of thenormalized-per-kWp initial investment cost for different values of the annual directnormal irradiation

Fig 7 Sensitivity analysis on LCOE of the HCPV systems as a function of thenormalized-per-kWp annual operation and maintenance cost for different value ofthe annual direct normal irradiation

Fig 8 Sensitivity analysis on LCOE of the HCPV systems as a function of thenominal discount rate for different values of the annual direct normal irradiation

56 DL Talavera et al Applied Energy 151 (2015) 49ndash59

the parameters for the estimation of the learning curves of eachscenario Also in order to compare the results with conventionalfixed PV technology a scenario with normalized-per-kWp initialinvestment cost [PVI]kWp of 1200 eurokWp in 2013 an annual growthof 8 and a learning rate of 8 is presented Fig 4 shows the resultsobtained for each of the cases examined and commented on Theseresults depend on multiple variables that can change over time andtherefore modify the data obtained However it is possible toexpect a future scenario in which the normalized-per-kWp initialinvestment cost of HCPV and conventional PV systems will beequal at a value ranging from 500 to 900 eurokWp

In this future scenario (the year 2020) the same normalized-per-kWp initial investment cost for conventional PV and HCPV sys-tems (700 eurokWp) has been considered together with the values ofthe factors shown in Table 9 the estimation of the levelised cost ofelectricity of HCPV and conventional PV systems in Spain The mapin Fig 5 shows the levelised cost of electricity of HCPV systems inthe future scenario As can be seen the area with the highest valuesof LCOE is located in the north of the map with a maximum valueof 0080 eurokW h (location number 3 Table 2) The area with thelowest values of LCOE is located in the south of the map with aminimum value of 0035 eurokW h (location number 1 Table 2)Furthermore there are also other locations with low values ofLCOE in the middle of the map with values of 0037 eurokW h (e glocation number 4 Table 2) and in the northeast of the map withvalues about 0040 eurokW h In this future scenario (2020) HCPVsystems with a DNI ranging from 2221 to 982 kW h(m2 year)can reach LCOE values ranging from 0035 to 0080 eurokW hrespectively

The value of the factors that are involved in the estimation ofthe LCOE of HCPV systems may change according to governmentsupport programmes and policies technology (the learning curvesand the economic scales) etc In order to analyse this in moredetail the study of the influence on the LCOE caused by the possi-ble change of the values of some of these factors has been carriedout In particular a sensitivity analysis regarding the influence ofthe normalized per-kWp initial investment cost ([HCPVI]kWp) thenormalized per-kWp annual operation and maintenance cost([HCPVAOM]kWp) and the nominal discount rate (d) has been con-ducted Figs 6ndash8 show the estimated LCOE of HCPV systems as afunction of the [HCPVI]kWp [HCPVAOM]kWp and d respectively fordifferent values of the annual direct normal irradiation It is impor-tant to mention that the rest of the factors involved in the estima-tion of the LCOE shown in each figure were kept constant at thevalues given in Table 9

Fig 6 shows the estimation of the LCOE as a function of the nor-malized-per-kWp initial investment cost for an annual direct

normal irradiation ranging from 1000 to 2200 kW hm2 This figureconsiders variations of the normalized-per-Wp initial investmentcost from 500 to 2200 eurokWp If the worst case is assumed([HCPVI]KWp = 2200 eurokWp and DNIA = 1000 kW hm2) the valueof the LCOE would be at around 0174 eurokW h On the other handif the best case is assumed ([CPVIN]kWp = 500 eurokWp and DNIA =2200 kW h(m2 year)) the value of the LCOE would be at around0030 eurokW h

Fig 7 shows the calculation of the LCOE as a function of the nor-malized per-kWp annual operation and maintenance cost of HCPVsystems for an annual direct normal irradiation ranging from 1000to 2200 kW hm2 If the worst case is assumed ([HCPVAOM]KWp =45 eurokWp and DNIA = 1000 kW h(m2 year)) the value of theLCOE would be at around 0098 eurokW h In contrast if the best caseis assumed ([HCPVAOM]kWp = 15 eurokWp and DNIA = 2200 kW h(m2 year)) the value of the LCOE would be at around 0028 eurokW h

Finally Fig 8 shows the calculation of the LCOE as a function ofthe nominal discount rate for the same values of the annual directnormal irradiation previously considered If the worst case isassumed (d = 8 and DNIA = 1000 kW h(m2 year)) the value ofthe LCOE would be at around 0101 eurokW h At the same time ifthe best case is assumed (d = 2 and DNIA = 2200 kW h(m2 year))the value of the LCOE would be at around 0031 eurokW h

The influence on the LCOE of HCPV systems of the variations ofthree different factors was conducted above It is also interestingto compare the influence of these factors on the estimated valueof the LCOE of HCPV systems To carry out this analysis the basecase of the future scenario (Table 9) and a typical DNIA of

Fig 9 Difference between the LCOE of HCPV and conventional PV systems in the future scenario analysed (2020)

DL Talavera et al Applied Energy 151 (2015) 49ndash59 57

1800 kW h(m2 year) were considered In this case the LCOE is0043 eurokW h At the same time the value of [HCPVI]kWp[HCPVAOM]KWp or d where varied a +20 respectively while the restof the factors involved in the analysis were kept constant Based onthis analysis a value of LCOE = 0046 eurokW h was obtained consid-ering the individual variation of [HCPVAOM]KWp or d and a valueof LCOE = 0048 eurokW h was obtained considering the individualvariation of [HCPVI]kWp Thus it can be concluded that LCOE has asimilar sensitivity to the variations of [HCPVAOM]KWp and d and dif-ferent and larger sensitivity to the variations of [HCPVI]kWp

Fig 9 shows the difference between the LCOE of HCPV and con-ventional PV systems in the future scenario examined in this paper(2020) The LCOE of both technologies has been estimated solvingthe equations and following the procedure outlined in Section 2together with the figures shown in Table 9 in a spreadsheet Theannual electricity yield by a conventional PV system with the pan-els optimally inclined over the horizontal and permanently ori-ented southward was estimated using Eq (8) considering aperformance ratio of 075 In Fig 9 positive values indicate thatthe LCOE of HCPV systems is higher than the LCOE of conventionalPV systems while negative values indicate that the LCOE of HCPVsystems is lower than the LCOE of conventional PV systems In thisfuture scenario (2020) the calculated LCOE of conventional PV sys-tems varies from 0037 to 0064 eurokW h for locations with a Hopt

from 2043 (location number 1 Table 2) to 1171 kW h(m2 year)(location number 3 Table 2) respectively The blue areas of themap located in the south middle and northeast of the map repre-sent locations where the LCOE of HCPV systems is lower than theLCOE of conventional PV systems (e g locations number 1 2 and4 Table 2) As can be seen there are a wide number of areas whereHCPV would be a more profitable technology from an economicpoint of view The green areas of the map represent locationswhere the values of the LCOE for HCPV and conventional PV

systems are the same which indicate that both technologies canrepresent a similar economic profitability Also there are a widenumber of areas where the LCOE of HCPV systems are higher thanthe LCOE of conventional PV systems (e g location number 3 and5 Table 2) in which conventional PV technology is a more prof-itable investment from an economic point of view These locationsare mainly located in the north of Spain and can be explained dueto the low annual direct normal irradiation levels which cause lowannual energy yields as shown in Fig 1

5 Conclusions

The economic feasibility of HCPV systems is increasingly beingevaluated using the levelised cost of electricity (LCOE) generationin order to be compared to other electricity generation technolo-gies This is vital in terms of industrial perspective in order to anal-yse the potential of this young technology In this paper an analysisof the LCOE of HCPV systems has been carried out in Spain Theresults obtained are shown in an innovative set of maps

According to the cost analysis HCPV systems at locationswith annual direct normal irradiation ranging from 2221 to982 kW h(m2 year) reached a LCOE ranging from 0081 up018 eurokW h in 2013 Also considering a positive market evaluationover the next few years In 2020 HCPV systems could reach a LCOEvalue ranging from 0035 to 0080 eurokW h from the maximum tominimum the annual direct normal irradiation values

Considering a future scenario in which the initial investmentcost for conventional PV and HCPV systems is the same it can bealso concluded that PV is not a more profitable technology thanHCPV for the whole of Spain -from an economic point of view-The selection of the technology for a specific location will mainlydepend on its annual direct and global irradiation In the case of

58 DL Talavera et al Applied Energy 151 (2015) 49ndash59

Spain an area located in the southwest and northeast where HCPVwould represent a more profitable investment and another arealocated in the north where conventional PV systems would be amore profitable investment It is also important to note thatalthough this analysis has been carried out for Spain this conclu-sion can be extended for other regions worldwide

Future owners and potential investors of HCPV systems demandvaluable information about the economic feasibility of their invest-ment so one aim of this document is to provide information aboutthe LCOE of HCPV systems with power higher than 1 MWpFurthermore Spanish governmental bodies which are involved inthe design or selection of the support mechanisms addressed toHCPV may be enlightened by the results of the present paper

Appendix A Terminology

[HCPVAOM]kWp

Normalized per-kWp annual operationand maintenance cost of the HCPV system(euro)

[HCPVI]kWp

Normalized per-kWp initial investmentcost of HCPV (eurokWp)

[PVAOM]kWp

Normalized per-kWp annual operationand maintenance cost of the PV system(euro)

[PVI]kWp

Normalized per-kWp initial investmentcost of PV (eurokWp)

d

Nominal discount rate ()

dec

Annual dividend the equity capital ndash

return on equityndash ()

DEP

Annual tax depreciation (euro)

DNIA

Annual Direct Normal Irradiation

(kW h(m2 year))

DNISTC

Direct Normal Irradiation in Standard Test

Condition (1 kW hm2)

GSTC

Global Irradiance in Standard Test

Condition (1 kWm2)

HCPVAOM

Annual operation and maintenance cost

of the HCPV system (euro)

HCPVec

Amount equal to the portion of the initial

investment financed with equity capital(euro)

HCPVI

Initial investment cost on the HCPVsystem (euro)

HCPVl

Amount equal to the portion of the initialinvestment financed with loan (euro)

Hopt A

Annual Global Irradiation on optimallyinclined plane (kW h(m2 year))

i

Annual inflation rate ()

il

Annual loan interest ()

LCC

Life cycle cost of the HCPV system (euro)

LCOE

Levelised cost of electricity (eurokW h)

LR

Learning rate

N

Life cycle of the HCPV system equal to

analysis period (years)

Nd

Tax life for depreciation (years)

Nl

Amortization of loan (years)

PR

Performance ratio ()

PW [DEP]

Present worth of the tax depreciation (euro)

PW [HCPVOM (N)]

Present worth of the HCPV system

operation and maintenance cost (euro)

q

Factor equal to (11 + d)

QHCPV

HCPV world cumulative installed capacity

QA

Annual growth installed capacity ()

rd

Annual degradation rate in the efficiencyof the HCPV panels ()

rOampM

Annual escalation rate of the operationand maintenance cost of the HCPV system()

SV

Salvage value of the system at the end oftheir life cycle (euro)

T

Income tax rate ()

WACC

Weighted Average Cost of Capital ()

YHCPV

Final AC annual energy yield in a HCPV

grid connected system (kW h(kWp year)

YPV

Final AC annual energy yield in a

conventional fixed FV grid connectedsystem kW h(kWp year)

References

[1] Muntildeoz E Vidal PG Nofuentes G Hontoria L Peacuterez-Higueras P Terrados J et alCPV standardization An overview Renew Sustain Energ Rev 201014518ndash23

[2] International Electrotechnical Commission IEC 62108 Concentratorphotovoltaic (CPV) modules and assemblies ndash design qualification and typeapproval Edition 10 Geneve 2007

[3] Globaldata Concentrated Photovoltaics (CPV) ndash Global market sizecompetitive landscape and key country analysis to 2020 UK 2014

[4] Fernaacutendez EF Peacuterez-Higueras P Garcia Loureiro AJ Vidal PG Outdoor evaluationof concentrator photovoltaic systems modules from different manufacturersFirst results and steps Prog Photovoltaics Res Appl 201321693ndash701

[5] Danchev S Maniatis G Tsakanikas A Returns on investment in electricityproducing photovoltaic systems under de-escalating feed-in tariffs The case ofGreece Renew Sustain Energy Rev 201014500ndash5

[6] Spertino F Di Leo P Cocina V Economic analysis of investment in the rooftopphotovoltaic systems A long-term research in the two main markets RenewSustain Energy Rev 201328531ndash40

[7] Talavera DL Muntildeoz-Ceroacuten E De La Casa J Ortega MJ Almonacid G Energy andeconomic analysis for large-scale integration of small photovoltaic systems inbuildings The case of a public location in Southern Spain Renew SustainEnergy Rev 2011154310ndash9

[8] Talavera DL de la Casa J Muntildeoz-Ceroacuten E Almonacid G Grid parity and self-consumption with photovoltaic systems under the present regulatoryframework in Spain The case of the University of Jaeacuten Campus RenewSustain Energy Rev 201433752ndash71

[9] Drury E Denholm P Margolis R The impact of different economic performancemetrics on the perceived value of solar photovoltaics October 2011 TechnicalReport NRELTP-6A20-52197

[10] Reddy KS Veershetty G Viability analysis of solar parabolic dish stand-alonepower plant for Indian conditions Appl Energy 2013102908ndash22

[11] Branker K Pathak MJM Pearce JM A review of solar photovoltaic levelized costof electricity Renew Sustain Energy Rev 2011154470ndash82

[12] Eclareon SL PV grid parity monitor residential sector 2nd issue May 2013 p40ndash2

[13] Fraunhofer institute for solar energy systems ISE Levelized cost of electricityrenewable energy technologies November 2013

[14] Fraisopi F The CPV market An industry perspective GTM Research IntersolarMuumlnchen June 2013

[15] Daniilidis A Herber R Vermaas DA Upscale potential and financial feasibilityof a reverse electrodialysis power plant Appl Energy 2014119257ndash65

[16] Goumlkccedilek M Genccedil MS Evaluation of electricity generation and energy cost ofwind energy conversion systems (WECSs) in Central Turkey Appl Energy2009862731ndash9

[17] Desideri U Campana PE Analysis and comparison between a concentratingsolar and a photovoltaic power plant Appl Energy 2014113422ndash33

[18] Hernaacutendez-Moro J Martiacutenez-Duart JM Analytical model for solar PV and CSPelectricity costs Present LCOE values and their future evolution RenewSustain Energy Rev 201320119ndash32

[19] International Renewable Energy Agency (IRENA) Renewable power generationcosts in 2012 An overview 2013 IRENA report ltwwwirenaorgPublicationsgt

[20] Short W Packey DJ Holt T A manual for the economic evaluation of energyefficiency and renewable energy technologies NRELTPndash462-5173 NationalRenewable Energy Laboratory 1995 p 1ndash120

[21] European photovoltaic industry association Solar photovoltaics competing inthe energy sector On the road to competitiveness 2011 lthttpwwwepiaorgnewspublicationsgt

[22] Swift KD A comparison of the cost and financial returns for solar photovoltaicsystems installed by businesses in different locations across the United StatesRenewable Energy 201357137ndash43

[23] Nishikawa Wea LCOE concentrating photovoltaic for CPV ICSC5 Conference2008

Fig 3 Forecast of the HCPV world cumulative capacity based on the three scenariosconsidered Low Conservative and Accelerated Market forecast conducted by theprivate companies IHS (HIS) Globaldata (GD) and SPV Market (SPV)

54 DL Talavera et al Applied Energy 151 (2015) 49ndash59

Fig 2 represents the levelised cost of electricity of HCPV sys-tems larger than 1 MWp and assuming a system performance ratio082 for 2013 In Fig 2 all data values are given as eurokW h As can beseen the area with the highest values of LCOE is located in thenorth of the map with a maximum value of 0184 eurokW h (locationnumber 3 Table 2) The area with the lowest values of LCOE islocated in the south of the map with a minimum value of0081 eurokW h (location number 1 Table 2) Furthermore thereare also other locations with low values of LCOE in the middle ofthe map with values of 0085 eurokW h (eg location number 4Table 2) and in the northeast of the map with values around0089 eurokW h In this scenario HCPV systems with a DNIA rangingfrom 2221 to 982 kW h(m2 year) can reach LCOE values rangingfrom 0081 to 0184 eurokW h respectively

The validation of the results obtained is difficult since there areno studies concerning the analysis of the LCOE of HCPV systems inSpain However in order to validate the results found Table 6shows the values of LCOE obtained for similar technologies andscenarios for different organizations It is important to note thatalthough similar the scenarios and inputs for the estimation ofthe LCOE are not the same Because of this different results areexpected However as can be seen the values of LCOE obtainedin this work are similar to those presented by other authors Forexample the study performed by Fraunhofer ISE analyses locationswhose DNIA range from 2000 to 2500 kW h(m2 year) and the val-ues of LCOE obtained range from 008 to 015 eurokW h These resultsare almost equal to those obtained in this study with values ofLCOE ranging from 008 to 018 eurokW h (the values are slightlyhigher since the DNIA in Spain varies from 1000 to 2200 kW h(m2 -year)) Also Solfocus Inc [59] estimates a LCOE of 008 eurokW h forlsquolsquoVictor Valley Collegersquorsquo power plant located in Victorville CA (USA)with an DNI of 2628 kW(m2 year) and GTM Research Inc [60] esti-mates a LCOE of 007 eurokW h for a power plant located in PhoenixAZ (USA) with an DNI of 2518 kW(m2 year) Hence it can be con-sidered that the results found here are accurate and are represen-tative of HCPV systems located in Spain

42 Comparison between the LCOE of HCPV and conventional PVsystems

The forecasting of the evolution of the market for a new tech-nology is a complex issue mainly due to the lack of historical dataand because of the rapid advances that occur in the first stages ofdevelopment In addition this evolution will be dependent onother factors such as the economic crisis and the support programsimplemented by several countries Because of this a reduction inthe manufacturing costs of the solar cells and the introduction oflow cost materials for manufacturing new optical devices areexpected in the next few years These will bring important indus-trial growth and consolidation in the manufacturing of HCPVmodules

HCPV technology has two main advantages when comparedwith other sources of energy [63] Firstly the high potential costreduction because of the reduction of expensive semiconductormaterials by cheaper optical devices The other main advantagesof HCPV compared with conventional PV technology are that the

Table 6LCOE for 2013 using the exchange rate 1euro = 136$ [136162]

Technology Organization LCOE (eurokW h)

Conventional PV EPIA 009ndash019Conventional PV IEA 012ndash016Conventional PV Fraunhofer ISE 007ndash010HCPV Fraunhofer ISE 008ndash015HCPV University of Jaeacuten 008ndash018

distribution of costs in a HCPV system has a wider spectrum thecost of cells not having such an important influence on the globalcost The result is that a great part of the system cost is transferredfrom the cells to other more varied and readily available technolo-gies leaving room in projects and investments from other very dif-ferent industrial sectors that can easily be adapted to manufacturethese new products (plastic glass metal mechanical industriesetc) The high efficiency of the elements of HCPV implies a reduc-tion of the area required for these systems leading to a substantialdecrease both in the investment and the price of the electricitygenerated Concentration cells have reached an in lab maximumefficiency of 44 [64] Therefore concentration modules are beingmanufactured with about 30ndash35 [65] efficiencies and the resultsof the measurements performed to the already installed HCPV sys-tems show values that double the efficiencies of the conventionalPV systems

Several market analyses [36667] indicate that the HCPV worldcumulative installed capacity in 2013 was 160 MWp and that thiscould exceed 1400 MWp in 2020 Based on the available informa-tion three different annual growth (QA in) scenarios of thiscapacity can be assumed as shown in Fig 3 a base case with agrowth of 30 (Conservative) a pessimistic case with a growth of27 (Low) and an optimistic case with a growth of 33(Accelerated)

Learning curves can be used to estimate the evolution of the ini-tial investment cost of HCPV systems for upcoming years Thesecurves described the cost reduction as a function of the accumu-lated experience in the manufacturing and in the use of a particulartechnology The learning curve of a HCPV system can be expressedas

HCPVI year frac14 HCPVI 2013Q HCPV year

Q HCPV2013

logeth1LRTHORN2

eth10THORN

where HCPVI year is the HCPV initial investment cost in the yearunder review HCPVI 2013 is the HCPV initial investment cost in

Table 7Learning ratio values of conventional PV as estimated by several authors [68ndash72]

AuthorDate Period of time analysed Region studied LR ()

Poponi2003 1976ndash2002 World 25Parente2002 1981ndash2000 World 23IEA2000 1976ndash1996 EU 21Harmon2000 1968ndash1998 World 20Poponi2003 1989ndash2002 World 20

Table 8Values of parameters for the estimation of the learning curve for the three scenariosconsidered

Factor Accelerated Conservative Low

Normalized-per-kWp initialinvestment cost [HCPVI 2013]kWp

1400eurokWp

1800eurokWp

2200eurokWp

Annual growth (QA) 33 30 27Learning rate (LR) 28 25 22

Fig 4 Learning curves of the normalized-per-kWp initial investment cost of HCPVsystems in different scenarios and of conventional PV systems Also the normal-ized-per-kWp initial investment cost of HCPV forecast conducted by the privatecompany GTM Research Inc [60]

Table 9Values of the factors assumed for the calculation of the LCOE in the future scenario(2020) for HCPV and conventional PV systems

Factors Case base values Units

HCPV Conventional PV

Annual yield According Fig 1 According (Eq (8)) kW h(kWp year)[HCPVI]kWp 700 eurokWp[HCPVAOM]kWp 28 eurokWp[PVAOM]kWp 20 eurokWprd 05 yearrOampM 22 yearT 30 i 22 d 448 il 4 4 Nl 20 20 yearsdec 8 8 N 30 years

Fig 5 Levelised cost of electricity of the HCP

DL Talavera et al Applied Energy 151 (2015) 49ndash59 55

2013 QHCPV year is the HCPV world cumulative installed capacity inthe year under review QHCPV 2013 is the HCPV world cumulativeinstalled capacity in 2013 and LR is the Learning Rate As was indi-cated in Table 3 the HCPV normalized-per-kWp initial investmentcost may be taken at 1800 eurokWp with a variation ranging from1400 to 2200 eurokWp

As can be seen in Table 7 the learning rate of conventional PVhas decreased with time as more experience in this technologyhas been gained This ratio has increased from a value of 25 inthe first stage of this technology (the seventies) until a currentvalue of 20 As mentioned HCPV technology is still in its firststages and therefore has a learning ratio varying from 22 to 28

Based on the data examined above three scenarios for the esti-mation of the learning curve of the initial investment cost of HCPVsystems should be considered Table 8 summarizes the values of

V systems in the future scenario (2020)

Fig 6 Sensitivity analysis on LCOE of the HCPV systems as a function of thenormalized-per-kWp initial investment cost for different values of the annual directnormal irradiation

Fig 7 Sensitivity analysis on LCOE of the HCPV systems as a function of thenormalized-per-kWp annual operation and maintenance cost for different value ofthe annual direct normal irradiation

Fig 8 Sensitivity analysis on LCOE of the HCPV systems as a function of thenominal discount rate for different values of the annual direct normal irradiation

56 DL Talavera et al Applied Energy 151 (2015) 49ndash59

the parameters for the estimation of the learning curves of eachscenario Also in order to compare the results with conventionalfixed PV technology a scenario with normalized-per-kWp initialinvestment cost [PVI]kWp of 1200 eurokWp in 2013 an annual growthof 8 and a learning rate of 8 is presented Fig 4 shows the resultsobtained for each of the cases examined and commented on Theseresults depend on multiple variables that can change over time andtherefore modify the data obtained However it is possible toexpect a future scenario in which the normalized-per-kWp initialinvestment cost of HCPV and conventional PV systems will beequal at a value ranging from 500 to 900 eurokWp

In this future scenario (the year 2020) the same normalized-per-kWp initial investment cost for conventional PV and HCPV sys-tems (700 eurokWp) has been considered together with the values ofthe factors shown in Table 9 the estimation of the levelised cost ofelectricity of HCPV and conventional PV systems in Spain The mapin Fig 5 shows the levelised cost of electricity of HCPV systems inthe future scenario As can be seen the area with the highest valuesof LCOE is located in the north of the map with a maximum valueof 0080 eurokW h (location number 3 Table 2) The area with thelowest values of LCOE is located in the south of the map with aminimum value of 0035 eurokW h (location number 1 Table 2)Furthermore there are also other locations with low values ofLCOE in the middle of the map with values of 0037 eurokW h (e glocation number 4 Table 2) and in the northeast of the map withvalues about 0040 eurokW h In this future scenario (2020) HCPVsystems with a DNI ranging from 2221 to 982 kW h(m2 year)can reach LCOE values ranging from 0035 to 0080 eurokW hrespectively

The value of the factors that are involved in the estimation ofthe LCOE of HCPV systems may change according to governmentsupport programmes and policies technology (the learning curvesand the economic scales) etc In order to analyse this in moredetail the study of the influence on the LCOE caused by the possi-ble change of the values of some of these factors has been carriedout In particular a sensitivity analysis regarding the influence ofthe normalized per-kWp initial investment cost ([HCPVI]kWp) thenormalized per-kWp annual operation and maintenance cost([HCPVAOM]kWp) and the nominal discount rate (d) has been con-ducted Figs 6ndash8 show the estimated LCOE of HCPV systems as afunction of the [HCPVI]kWp [HCPVAOM]kWp and d respectively fordifferent values of the annual direct normal irradiation It is impor-tant to mention that the rest of the factors involved in the estima-tion of the LCOE shown in each figure were kept constant at thevalues given in Table 9

Fig 6 shows the estimation of the LCOE as a function of the nor-malized-per-kWp initial investment cost for an annual direct

normal irradiation ranging from 1000 to 2200 kW hm2 This figureconsiders variations of the normalized-per-Wp initial investmentcost from 500 to 2200 eurokWp If the worst case is assumed([HCPVI]KWp = 2200 eurokWp and DNIA = 1000 kW hm2) the valueof the LCOE would be at around 0174 eurokW h On the other handif the best case is assumed ([CPVIN]kWp = 500 eurokWp and DNIA =2200 kW h(m2 year)) the value of the LCOE would be at around0030 eurokW h

Fig 7 shows the calculation of the LCOE as a function of the nor-malized per-kWp annual operation and maintenance cost of HCPVsystems for an annual direct normal irradiation ranging from 1000to 2200 kW hm2 If the worst case is assumed ([HCPVAOM]KWp =45 eurokWp and DNIA = 1000 kW h(m2 year)) the value of theLCOE would be at around 0098 eurokW h In contrast if the best caseis assumed ([HCPVAOM]kWp = 15 eurokWp and DNIA = 2200 kW h(m2 year)) the value of the LCOE would be at around 0028 eurokW h

Finally Fig 8 shows the calculation of the LCOE as a function ofthe nominal discount rate for the same values of the annual directnormal irradiation previously considered If the worst case isassumed (d = 8 and DNIA = 1000 kW h(m2 year)) the value ofthe LCOE would be at around 0101 eurokW h At the same time ifthe best case is assumed (d = 2 and DNIA = 2200 kW h(m2 year))the value of the LCOE would be at around 0031 eurokW h

The influence on the LCOE of HCPV systems of the variations ofthree different factors was conducted above It is also interestingto compare the influence of these factors on the estimated valueof the LCOE of HCPV systems To carry out this analysis the basecase of the future scenario (Table 9) and a typical DNIA of

Fig 9 Difference between the LCOE of HCPV and conventional PV systems in the future scenario analysed (2020)

DL Talavera et al Applied Energy 151 (2015) 49ndash59 57

1800 kW h(m2 year) were considered In this case the LCOE is0043 eurokW h At the same time the value of [HCPVI]kWp[HCPVAOM]KWp or d where varied a +20 respectively while the restof the factors involved in the analysis were kept constant Based onthis analysis a value of LCOE = 0046 eurokW h was obtained consid-ering the individual variation of [HCPVAOM]KWp or d and a valueof LCOE = 0048 eurokW h was obtained considering the individualvariation of [HCPVI]kWp Thus it can be concluded that LCOE has asimilar sensitivity to the variations of [HCPVAOM]KWp and d and dif-ferent and larger sensitivity to the variations of [HCPVI]kWp

Fig 9 shows the difference between the LCOE of HCPV and con-ventional PV systems in the future scenario examined in this paper(2020) The LCOE of both technologies has been estimated solvingthe equations and following the procedure outlined in Section 2together with the figures shown in Table 9 in a spreadsheet Theannual electricity yield by a conventional PV system with the pan-els optimally inclined over the horizontal and permanently ori-ented southward was estimated using Eq (8) considering aperformance ratio of 075 In Fig 9 positive values indicate thatthe LCOE of HCPV systems is higher than the LCOE of conventionalPV systems while negative values indicate that the LCOE of HCPVsystems is lower than the LCOE of conventional PV systems In thisfuture scenario (2020) the calculated LCOE of conventional PV sys-tems varies from 0037 to 0064 eurokW h for locations with a Hopt

from 2043 (location number 1 Table 2) to 1171 kW h(m2 year)(location number 3 Table 2) respectively The blue areas of themap located in the south middle and northeast of the map repre-sent locations where the LCOE of HCPV systems is lower than theLCOE of conventional PV systems (e g locations number 1 2 and4 Table 2) As can be seen there are a wide number of areas whereHCPV would be a more profitable technology from an economicpoint of view The green areas of the map represent locationswhere the values of the LCOE for HCPV and conventional PV

systems are the same which indicate that both technologies canrepresent a similar economic profitability Also there are a widenumber of areas where the LCOE of HCPV systems are higher thanthe LCOE of conventional PV systems (e g location number 3 and5 Table 2) in which conventional PV technology is a more prof-itable investment from an economic point of view These locationsare mainly located in the north of Spain and can be explained dueto the low annual direct normal irradiation levels which cause lowannual energy yields as shown in Fig 1

5 Conclusions

The economic feasibility of HCPV systems is increasingly beingevaluated using the levelised cost of electricity (LCOE) generationin order to be compared to other electricity generation technolo-gies This is vital in terms of industrial perspective in order to anal-yse the potential of this young technology In this paper an analysisof the LCOE of HCPV systems has been carried out in Spain Theresults obtained are shown in an innovative set of maps

According to the cost analysis HCPV systems at locationswith annual direct normal irradiation ranging from 2221 to982 kW h(m2 year) reached a LCOE ranging from 0081 up018 eurokW h in 2013 Also considering a positive market evaluationover the next few years In 2020 HCPV systems could reach a LCOEvalue ranging from 0035 to 0080 eurokW h from the maximum tominimum the annual direct normal irradiation values

Considering a future scenario in which the initial investmentcost for conventional PV and HCPV systems is the same it can bealso concluded that PV is not a more profitable technology thanHCPV for the whole of Spain -from an economic point of view-The selection of the technology for a specific location will mainlydepend on its annual direct and global irradiation In the case of

58 DL Talavera et al Applied Energy 151 (2015) 49ndash59

Spain an area located in the southwest and northeast where HCPVwould represent a more profitable investment and another arealocated in the north where conventional PV systems would be amore profitable investment It is also important to note thatalthough this analysis has been carried out for Spain this conclu-sion can be extended for other regions worldwide

Future owners and potential investors of HCPV systems demandvaluable information about the economic feasibility of their invest-ment so one aim of this document is to provide information aboutthe LCOE of HCPV systems with power higher than 1 MWpFurthermore Spanish governmental bodies which are involved inthe design or selection of the support mechanisms addressed toHCPV may be enlightened by the results of the present paper

Appendix A Terminology

[HCPVAOM]kWp

Normalized per-kWp annual operationand maintenance cost of the HCPV system(euro)

[HCPVI]kWp

Normalized per-kWp initial investmentcost of HCPV (eurokWp)

[PVAOM]kWp

Normalized per-kWp annual operationand maintenance cost of the PV system(euro)

[PVI]kWp

Normalized per-kWp initial investmentcost of PV (eurokWp)

d

Nominal discount rate ()

dec

Annual dividend the equity capital ndash

return on equityndash ()

DEP

Annual tax depreciation (euro)

DNIA

Annual Direct Normal Irradiation

(kW h(m2 year))

DNISTC

Direct Normal Irradiation in Standard Test

Condition (1 kW hm2)

GSTC

Global Irradiance in Standard Test

Condition (1 kWm2)

HCPVAOM

Annual operation and maintenance cost

of the HCPV system (euro)

HCPVec

Amount equal to the portion of the initial

investment financed with equity capital(euro)

HCPVI

Initial investment cost on the HCPVsystem (euro)

HCPVl

Amount equal to the portion of the initialinvestment financed with loan (euro)

Hopt A

Annual Global Irradiation on optimallyinclined plane (kW h(m2 year))

i

Annual inflation rate ()

il

Annual loan interest ()

LCC

Life cycle cost of the HCPV system (euro)

LCOE

Levelised cost of electricity (eurokW h)

LR

Learning rate

N

Life cycle of the HCPV system equal to

analysis period (years)

Nd

Tax life for depreciation (years)

Nl

Amortization of loan (years)

PR

Performance ratio ()

PW [DEP]

Present worth of the tax depreciation (euro)

PW [HCPVOM (N)]

Present worth of the HCPV system

operation and maintenance cost (euro)

q

Factor equal to (11 + d)

QHCPV

HCPV world cumulative installed capacity

QA

Annual growth installed capacity ()

rd

Annual degradation rate in the efficiencyof the HCPV panels ()

rOampM

Annual escalation rate of the operationand maintenance cost of the HCPV system()

SV

Salvage value of the system at the end oftheir life cycle (euro)

T

Income tax rate ()

WACC

Weighted Average Cost of Capital ()

YHCPV

Final AC annual energy yield in a HCPV

grid connected system (kW h(kWp year)

YPV

Final AC annual energy yield in a

conventional fixed FV grid connectedsystem kW h(kWp year)

References

[1] Muntildeoz E Vidal PG Nofuentes G Hontoria L Peacuterez-Higueras P Terrados J et alCPV standardization An overview Renew Sustain Energ Rev 201014518ndash23

[2] International Electrotechnical Commission IEC 62108 Concentratorphotovoltaic (CPV) modules and assemblies ndash design qualification and typeapproval Edition 10 Geneve 2007

[3] Globaldata Concentrated Photovoltaics (CPV) ndash Global market sizecompetitive landscape and key country analysis to 2020 UK 2014

[4] Fernaacutendez EF Peacuterez-Higueras P Garcia Loureiro AJ Vidal PG Outdoor evaluationof concentrator photovoltaic systems modules from different manufacturersFirst results and steps Prog Photovoltaics Res Appl 201321693ndash701

[5] Danchev S Maniatis G Tsakanikas A Returns on investment in electricityproducing photovoltaic systems under de-escalating feed-in tariffs The case ofGreece Renew Sustain Energy Rev 201014500ndash5

[6] Spertino F Di Leo P Cocina V Economic analysis of investment in the rooftopphotovoltaic systems A long-term research in the two main markets RenewSustain Energy Rev 201328531ndash40

[7] Talavera DL Muntildeoz-Ceroacuten E De La Casa J Ortega MJ Almonacid G Energy andeconomic analysis for large-scale integration of small photovoltaic systems inbuildings The case of a public location in Southern Spain Renew SustainEnergy Rev 2011154310ndash9

[8] Talavera DL de la Casa J Muntildeoz-Ceroacuten E Almonacid G Grid parity and self-consumption with photovoltaic systems under the present regulatoryframework in Spain The case of the University of Jaeacuten Campus RenewSustain Energy Rev 201433752ndash71

[9] Drury E Denholm P Margolis R The impact of different economic performancemetrics on the perceived value of solar photovoltaics October 2011 TechnicalReport NRELTP-6A20-52197

[10] Reddy KS Veershetty G Viability analysis of solar parabolic dish stand-alonepower plant for Indian conditions Appl Energy 2013102908ndash22

[11] Branker K Pathak MJM Pearce JM A review of solar photovoltaic levelized costof electricity Renew Sustain Energy Rev 2011154470ndash82

[12] Eclareon SL PV grid parity monitor residential sector 2nd issue May 2013 p40ndash2

[13] Fraunhofer institute for solar energy systems ISE Levelized cost of electricityrenewable energy technologies November 2013

[14] Fraisopi F The CPV market An industry perspective GTM Research IntersolarMuumlnchen June 2013

[15] Daniilidis A Herber R Vermaas DA Upscale potential and financial feasibilityof a reverse electrodialysis power plant Appl Energy 2014119257ndash65

[16] Goumlkccedilek M Genccedil MS Evaluation of electricity generation and energy cost ofwind energy conversion systems (WECSs) in Central Turkey Appl Energy2009862731ndash9

[17] Desideri U Campana PE Analysis and comparison between a concentratingsolar and a photovoltaic power plant Appl Energy 2014113422ndash33

[18] Hernaacutendez-Moro J Martiacutenez-Duart JM Analytical model for solar PV and CSPelectricity costs Present LCOE values and their future evolution RenewSustain Energy Rev 201320119ndash32

[19] International Renewable Energy Agency (IRENA) Renewable power generationcosts in 2012 An overview 2013 IRENA report ltwwwirenaorgPublicationsgt

[20] Short W Packey DJ Holt T A manual for the economic evaluation of energyefficiency and renewable energy technologies NRELTPndash462-5173 NationalRenewable Energy Laboratory 1995 p 1ndash120

[21] European photovoltaic industry association Solar photovoltaics competing inthe energy sector On the road to competitiveness 2011 lthttpwwwepiaorgnewspublicationsgt

[22] Swift KD A comparison of the cost and financial returns for solar photovoltaicsystems installed by businesses in different locations across the United StatesRenewable Energy 201357137ndash43

[23] Nishikawa Wea LCOE concentrating photovoltaic for CPV ICSC5 Conference2008

Table 8Values of parameters for the estimation of the learning curve for the three scenariosconsidered

Factor Accelerated Conservative Low

Normalized-per-kWp initialinvestment cost [HCPVI 2013]kWp

1400eurokWp

1800eurokWp

2200eurokWp

Annual growth (QA) 33 30 27Learning rate (LR) 28 25 22

Fig 4 Learning curves of the normalized-per-kWp initial investment cost of HCPVsystems in different scenarios and of conventional PV systems Also the normal-ized-per-kWp initial investment cost of HCPV forecast conducted by the privatecompany GTM Research Inc [60]

Table 9Values of the factors assumed for the calculation of the LCOE in the future scenario(2020) for HCPV and conventional PV systems

Factors Case base values Units

HCPV Conventional PV

Annual yield According Fig 1 According (Eq (8)) kW h(kWp year)[HCPVI]kWp 700 eurokWp[HCPVAOM]kWp 28 eurokWp[PVAOM]kWp 20 eurokWprd 05 yearrOampM 22 yearT 30 i 22 d 448 il 4 4 Nl 20 20 yearsdec 8 8 N 30 years

Fig 5 Levelised cost of electricity of the HCP

DL Talavera et al Applied Energy 151 (2015) 49ndash59 55

2013 QHCPV year is the HCPV world cumulative installed capacity inthe year under review QHCPV 2013 is the HCPV world cumulativeinstalled capacity in 2013 and LR is the Learning Rate As was indi-cated in Table 3 the HCPV normalized-per-kWp initial investmentcost may be taken at 1800 eurokWp with a variation ranging from1400 to 2200 eurokWp

As can be seen in Table 7 the learning rate of conventional PVhas decreased with time as more experience in this technologyhas been gained This ratio has increased from a value of 25 inthe first stage of this technology (the seventies) until a currentvalue of 20 As mentioned HCPV technology is still in its firststages and therefore has a learning ratio varying from 22 to 28

Based on the data examined above three scenarios for the esti-mation of the learning curve of the initial investment cost of HCPVsystems should be considered Table 8 summarizes the values of

V systems in the future scenario (2020)

Fig 6 Sensitivity analysis on LCOE of the HCPV systems as a function of thenormalized-per-kWp initial investment cost for different values of the annual directnormal irradiation

Fig 7 Sensitivity analysis on LCOE of the HCPV systems as a function of thenormalized-per-kWp annual operation and maintenance cost for different value ofthe annual direct normal irradiation

Fig 8 Sensitivity analysis on LCOE of the HCPV systems as a function of thenominal discount rate for different values of the annual direct normal irradiation

56 DL Talavera et al Applied Energy 151 (2015) 49ndash59

the parameters for the estimation of the learning curves of eachscenario Also in order to compare the results with conventionalfixed PV technology a scenario with normalized-per-kWp initialinvestment cost [PVI]kWp of 1200 eurokWp in 2013 an annual growthof 8 and a learning rate of 8 is presented Fig 4 shows the resultsobtained for each of the cases examined and commented on Theseresults depend on multiple variables that can change over time andtherefore modify the data obtained However it is possible toexpect a future scenario in which the normalized-per-kWp initialinvestment cost of HCPV and conventional PV systems will beequal at a value ranging from 500 to 900 eurokWp

In this future scenario (the year 2020) the same normalized-per-kWp initial investment cost for conventional PV and HCPV sys-tems (700 eurokWp) has been considered together with the values ofthe factors shown in Table 9 the estimation of the levelised cost ofelectricity of HCPV and conventional PV systems in Spain The mapin Fig 5 shows the levelised cost of electricity of HCPV systems inthe future scenario As can be seen the area with the highest valuesof LCOE is located in the north of the map with a maximum valueof 0080 eurokW h (location number 3 Table 2) The area with thelowest values of LCOE is located in the south of the map with aminimum value of 0035 eurokW h (location number 1 Table 2)Furthermore there are also other locations with low values ofLCOE in the middle of the map with values of 0037 eurokW h (e glocation number 4 Table 2) and in the northeast of the map withvalues about 0040 eurokW h In this future scenario (2020) HCPVsystems with a DNI ranging from 2221 to 982 kW h(m2 year)can reach LCOE values ranging from 0035 to 0080 eurokW hrespectively

The value of the factors that are involved in the estimation ofthe LCOE of HCPV systems may change according to governmentsupport programmes and policies technology (the learning curvesand the economic scales) etc In order to analyse this in moredetail the study of the influence on the LCOE caused by the possi-ble change of the values of some of these factors has been carriedout In particular a sensitivity analysis regarding the influence ofthe normalized per-kWp initial investment cost ([HCPVI]kWp) thenormalized per-kWp annual operation and maintenance cost([HCPVAOM]kWp) and the nominal discount rate (d) has been con-ducted Figs 6ndash8 show the estimated LCOE of HCPV systems as afunction of the [HCPVI]kWp [HCPVAOM]kWp and d respectively fordifferent values of the annual direct normal irradiation It is impor-tant to mention that the rest of the factors involved in the estima-tion of the LCOE shown in each figure were kept constant at thevalues given in Table 9

Fig 6 shows the estimation of the LCOE as a function of the nor-malized-per-kWp initial investment cost for an annual direct

normal irradiation ranging from 1000 to 2200 kW hm2 This figureconsiders variations of the normalized-per-Wp initial investmentcost from 500 to 2200 eurokWp If the worst case is assumed([HCPVI]KWp = 2200 eurokWp and DNIA = 1000 kW hm2) the valueof the LCOE would be at around 0174 eurokW h On the other handif the best case is assumed ([CPVIN]kWp = 500 eurokWp and DNIA =2200 kW h(m2 year)) the value of the LCOE would be at around0030 eurokW h

Fig 7 shows the calculation of the LCOE as a function of the nor-malized per-kWp annual operation and maintenance cost of HCPVsystems for an annual direct normal irradiation ranging from 1000to 2200 kW hm2 If the worst case is assumed ([HCPVAOM]KWp =45 eurokWp and DNIA = 1000 kW h(m2 year)) the value of theLCOE would be at around 0098 eurokW h In contrast if the best caseis assumed ([HCPVAOM]kWp = 15 eurokWp and DNIA = 2200 kW h(m2 year)) the value of the LCOE would be at around 0028 eurokW h

Finally Fig 8 shows the calculation of the LCOE as a function ofthe nominal discount rate for the same values of the annual directnormal irradiation previously considered If the worst case isassumed (d = 8 and DNIA = 1000 kW h(m2 year)) the value ofthe LCOE would be at around 0101 eurokW h At the same time ifthe best case is assumed (d = 2 and DNIA = 2200 kW h(m2 year))the value of the LCOE would be at around 0031 eurokW h

The influence on the LCOE of HCPV systems of the variations ofthree different factors was conducted above It is also interestingto compare the influence of these factors on the estimated valueof the LCOE of HCPV systems To carry out this analysis the basecase of the future scenario (Table 9) and a typical DNIA of

Fig 9 Difference between the LCOE of HCPV and conventional PV systems in the future scenario analysed (2020)

DL Talavera et al Applied Energy 151 (2015) 49ndash59 57

1800 kW h(m2 year) were considered In this case the LCOE is0043 eurokW h At the same time the value of [HCPVI]kWp[HCPVAOM]KWp or d where varied a +20 respectively while the restof the factors involved in the analysis were kept constant Based onthis analysis a value of LCOE = 0046 eurokW h was obtained consid-ering the individual variation of [HCPVAOM]KWp or d and a valueof LCOE = 0048 eurokW h was obtained considering the individualvariation of [HCPVI]kWp Thus it can be concluded that LCOE has asimilar sensitivity to the variations of [HCPVAOM]KWp and d and dif-ferent and larger sensitivity to the variations of [HCPVI]kWp

Fig 9 shows the difference between the LCOE of HCPV and con-ventional PV systems in the future scenario examined in this paper(2020) The LCOE of both technologies has been estimated solvingthe equations and following the procedure outlined in Section 2together with the figures shown in Table 9 in a spreadsheet Theannual electricity yield by a conventional PV system with the pan-els optimally inclined over the horizontal and permanently ori-ented southward was estimated using Eq (8) considering aperformance ratio of 075 In Fig 9 positive values indicate thatthe LCOE of HCPV systems is higher than the LCOE of conventionalPV systems while negative values indicate that the LCOE of HCPVsystems is lower than the LCOE of conventional PV systems In thisfuture scenario (2020) the calculated LCOE of conventional PV sys-tems varies from 0037 to 0064 eurokW h for locations with a Hopt

from 2043 (location number 1 Table 2) to 1171 kW h(m2 year)(location number 3 Table 2) respectively The blue areas of themap located in the south middle and northeast of the map repre-sent locations where the LCOE of HCPV systems is lower than theLCOE of conventional PV systems (e g locations number 1 2 and4 Table 2) As can be seen there are a wide number of areas whereHCPV would be a more profitable technology from an economicpoint of view The green areas of the map represent locationswhere the values of the LCOE for HCPV and conventional PV

systems are the same which indicate that both technologies canrepresent a similar economic profitability Also there are a widenumber of areas where the LCOE of HCPV systems are higher thanthe LCOE of conventional PV systems (e g location number 3 and5 Table 2) in which conventional PV technology is a more prof-itable investment from an economic point of view These locationsare mainly located in the north of Spain and can be explained dueto the low annual direct normal irradiation levels which cause lowannual energy yields as shown in Fig 1

5 Conclusions

The economic feasibility of HCPV systems is increasingly beingevaluated using the levelised cost of electricity (LCOE) generationin order to be compared to other electricity generation technolo-gies This is vital in terms of industrial perspective in order to anal-yse the potential of this young technology In this paper an analysisof the LCOE of HCPV systems has been carried out in Spain Theresults obtained are shown in an innovative set of maps

According to the cost analysis HCPV systems at locationswith annual direct normal irradiation ranging from 2221 to982 kW h(m2 year) reached a LCOE ranging from 0081 up018 eurokW h in 2013 Also considering a positive market evaluationover the next few years In 2020 HCPV systems could reach a LCOEvalue ranging from 0035 to 0080 eurokW h from the maximum tominimum the annual direct normal irradiation values

Considering a future scenario in which the initial investmentcost for conventional PV and HCPV systems is the same it can bealso concluded that PV is not a more profitable technology thanHCPV for the whole of Spain -from an economic point of view-The selection of the technology for a specific location will mainlydepend on its annual direct and global irradiation In the case of

58 DL Talavera et al Applied Energy 151 (2015) 49ndash59

Spain an area located in the southwest and northeast where HCPVwould represent a more profitable investment and another arealocated in the north where conventional PV systems would be amore profitable investment It is also important to note thatalthough this analysis has been carried out for Spain this conclu-sion can be extended for other regions worldwide

Future owners and potential investors of HCPV systems demandvaluable information about the economic feasibility of their invest-ment so one aim of this document is to provide information aboutthe LCOE of HCPV systems with power higher than 1 MWpFurthermore Spanish governmental bodies which are involved inthe design or selection of the support mechanisms addressed toHCPV may be enlightened by the results of the present paper

Appendix A Terminology

[HCPVAOM]kWp

Normalized per-kWp annual operationand maintenance cost of the HCPV system(euro)

[HCPVI]kWp

Normalized per-kWp initial investmentcost of HCPV (eurokWp)

[PVAOM]kWp

Normalized per-kWp annual operationand maintenance cost of the PV system(euro)

[PVI]kWp

Normalized per-kWp initial investmentcost of PV (eurokWp)

d

Nominal discount rate ()

dec

Annual dividend the equity capital ndash

return on equityndash ()

DEP

Annual tax depreciation (euro)

DNIA

Annual Direct Normal Irradiation

(kW h(m2 year))

DNISTC

Direct Normal Irradiation in Standard Test

Condition (1 kW hm2)

GSTC

Global Irradiance in Standard Test

Condition (1 kWm2)

HCPVAOM

Annual operation and maintenance cost

of the HCPV system (euro)

HCPVec

Amount equal to the portion of the initial

investment financed with equity capital(euro)

HCPVI

Initial investment cost on the HCPVsystem (euro)

HCPVl

Amount equal to the portion of the initialinvestment financed with loan (euro)

Hopt A

Annual Global Irradiation on optimallyinclined plane (kW h(m2 year))

i

Annual inflation rate ()

il

Annual loan interest ()

LCC

Life cycle cost of the HCPV system (euro)

LCOE

Levelised cost of electricity (eurokW h)

LR

Learning rate

N

Life cycle of the HCPV system equal to

analysis period (years)

Nd

Tax life for depreciation (years)

Nl

Amortization of loan (years)

PR

Performance ratio ()

PW [DEP]

Present worth of the tax depreciation (euro)

PW [HCPVOM (N)]

Present worth of the HCPV system

operation and maintenance cost (euro)

q

Factor equal to (11 + d)

QHCPV

HCPV world cumulative installed capacity

QA

Annual growth installed capacity ()

rd

Annual degradation rate in the efficiencyof the HCPV panels ()

rOampM

Annual escalation rate of the operationand maintenance cost of the HCPV system()

SV

Salvage value of the system at the end oftheir life cycle (euro)

T

Income tax rate ()

WACC

Weighted Average Cost of Capital ()

YHCPV

Final AC annual energy yield in a HCPV

grid connected system (kW h(kWp year)

YPV

Final AC annual energy yield in a

conventional fixed FV grid connectedsystem kW h(kWp year)

References

[1] Muntildeoz E Vidal PG Nofuentes G Hontoria L Peacuterez-Higueras P Terrados J et alCPV standardization An overview Renew Sustain Energ Rev 201014518ndash23

[2] International Electrotechnical Commission IEC 62108 Concentratorphotovoltaic (CPV) modules and assemblies ndash design qualification and typeapproval Edition 10 Geneve 2007

[3] Globaldata Concentrated Photovoltaics (CPV) ndash Global market sizecompetitive landscape and key country analysis to 2020 UK 2014

[4] Fernaacutendez EF Peacuterez-Higueras P Garcia Loureiro AJ Vidal PG Outdoor evaluationof concentrator photovoltaic systems modules from different manufacturersFirst results and steps Prog Photovoltaics Res Appl 201321693ndash701

[5] Danchev S Maniatis G Tsakanikas A Returns on investment in electricityproducing photovoltaic systems under de-escalating feed-in tariffs The case ofGreece Renew Sustain Energy Rev 201014500ndash5

[6] Spertino F Di Leo P Cocina V Economic analysis of investment in the rooftopphotovoltaic systems A long-term research in the two main markets RenewSustain Energy Rev 201328531ndash40

[7] Talavera DL Muntildeoz-Ceroacuten E De La Casa J Ortega MJ Almonacid G Energy andeconomic analysis for large-scale integration of small photovoltaic systems inbuildings The case of a public location in Southern Spain Renew SustainEnergy Rev 2011154310ndash9

[8] Talavera DL de la Casa J Muntildeoz-Ceroacuten E Almonacid G Grid parity and self-consumption with photovoltaic systems under the present regulatoryframework in Spain The case of the University of Jaeacuten Campus RenewSustain Energy Rev 201433752ndash71

[9] Drury E Denholm P Margolis R The impact of different economic performancemetrics on the perceived value of solar photovoltaics October 2011 TechnicalReport NRELTP-6A20-52197

[10] Reddy KS Veershetty G Viability analysis of solar parabolic dish stand-alonepower plant for Indian conditions Appl Energy 2013102908ndash22

[11] Branker K Pathak MJM Pearce JM A review of solar photovoltaic levelized costof electricity Renew Sustain Energy Rev 2011154470ndash82

[12] Eclareon SL PV grid parity monitor residential sector 2nd issue May 2013 p40ndash2

[13] Fraunhofer institute for solar energy systems ISE Levelized cost of electricityrenewable energy technologies November 2013

[14] Fraisopi F The CPV market An industry perspective GTM Research IntersolarMuumlnchen June 2013

[15] Daniilidis A Herber R Vermaas DA Upscale potential and financial feasibilityof a reverse electrodialysis power plant Appl Energy 2014119257ndash65

[16] Goumlkccedilek M Genccedil MS Evaluation of electricity generation and energy cost ofwind energy conversion systems (WECSs) in Central Turkey Appl Energy2009862731ndash9

[17] Desideri U Campana PE Analysis and comparison between a concentratingsolar and a photovoltaic power plant Appl Energy 2014113422ndash33

[18] Hernaacutendez-Moro J Martiacutenez-Duart JM Analytical model for solar PV and CSPelectricity costs Present LCOE values and their future evolution RenewSustain Energy Rev 201320119ndash32

[19] International Renewable Energy Agency (IRENA) Renewable power generationcosts in 2012 An overview 2013 IRENA report ltwwwirenaorgPublicationsgt

[20] Short W Packey DJ Holt T A manual for the economic evaluation of energyefficiency and renewable energy technologies NRELTPndash462-5173 NationalRenewable Energy Laboratory 1995 p 1ndash120

[21] European photovoltaic industry association Solar photovoltaics competing inthe energy sector On the road to competitiveness 2011 lthttpwwwepiaorgnewspublicationsgt

[22] Swift KD A comparison of the cost and financial returns for solar photovoltaicsystems installed by businesses in different locations across the United StatesRenewable Energy 201357137ndash43

[23] Nishikawa Wea LCOE concentrating photovoltaic for CPV ICSC5 Conference2008

Fig 6 Sensitivity analysis on LCOE of the HCPV systems as a function of thenormalized-per-kWp initial investment cost for different values of the annual directnormal irradiation

Fig 7 Sensitivity analysis on LCOE of the HCPV systems as a function of thenormalized-per-kWp annual operation and maintenance cost for different value ofthe annual direct normal irradiation

Fig 8 Sensitivity analysis on LCOE of the HCPV systems as a function of thenominal discount rate for different values of the annual direct normal irradiation

56 DL Talavera et al Applied Energy 151 (2015) 49ndash59

the parameters for the estimation of the learning curves of eachscenario Also in order to compare the results with conventionalfixed PV technology a scenario with normalized-per-kWp initialinvestment cost [PVI]kWp of 1200 eurokWp in 2013 an annual growthof 8 and a learning rate of 8 is presented Fig 4 shows the resultsobtained for each of the cases examined and commented on Theseresults depend on multiple variables that can change over time andtherefore modify the data obtained However it is possible toexpect a future scenario in which the normalized-per-kWp initialinvestment cost of HCPV and conventional PV systems will beequal at a value ranging from 500 to 900 eurokWp

In this future scenario (the year 2020) the same normalized-per-kWp initial investment cost for conventional PV and HCPV sys-tems (700 eurokWp) has been considered together with the values ofthe factors shown in Table 9 the estimation of the levelised cost ofelectricity of HCPV and conventional PV systems in Spain The mapin Fig 5 shows the levelised cost of electricity of HCPV systems inthe future scenario As can be seen the area with the highest valuesof LCOE is located in the north of the map with a maximum valueof 0080 eurokW h (location number 3 Table 2) The area with thelowest values of LCOE is located in the south of the map with aminimum value of 0035 eurokW h (location number 1 Table 2)Furthermore there are also other locations with low values ofLCOE in the middle of the map with values of 0037 eurokW h (e glocation number 4 Table 2) and in the northeast of the map withvalues about 0040 eurokW h In this future scenario (2020) HCPVsystems with a DNI ranging from 2221 to 982 kW h(m2 year)can reach LCOE values ranging from 0035 to 0080 eurokW hrespectively

The value of the factors that are involved in the estimation ofthe LCOE of HCPV systems may change according to governmentsupport programmes and policies technology (the learning curvesand the economic scales) etc In order to analyse this in moredetail the study of the influence on the LCOE caused by the possi-ble change of the values of some of these factors has been carriedout In particular a sensitivity analysis regarding the influence ofthe normalized per-kWp initial investment cost ([HCPVI]kWp) thenormalized per-kWp annual operation and maintenance cost([HCPVAOM]kWp) and the nominal discount rate (d) has been con-ducted Figs 6ndash8 show the estimated LCOE of HCPV systems as afunction of the [HCPVI]kWp [HCPVAOM]kWp and d respectively fordifferent values of the annual direct normal irradiation It is impor-tant to mention that the rest of the factors involved in the estima-tion of the LCOE shown in each figure were kept constant at thevalues given in Table 9

Fig 6 shows the estimation of the LCOE as a function of the nor-malized-per-kWp initial investment cost for an annual direct

normal irradiation ranging from 1000 to 2200 kW hm2 This figureconsiders variations of the normalized-per-Wp initial investmentcost from 500 to 2200 eurokWp If the worst case is assumed([HCPVI]KWp = 2200 eurokWp and DNIA = 1000 kW hm2) the valueof the LCOE would be at around 0174 eurokW h On the other handif the best case is assumed ([CPVIN]kWp = 500 eurokWp and DNIA =2200 kW h(m2 year)) the value of the LCOE would be at around0030 eurokW h

Fig 7 shows the calculation of the LCOE as a function of the nor-malized per-kWp annual operation and maintenance cost of HCPVsystems for an annual direct normal irradiation ranging from 1000to 2200 kW hm2 If the worst case is assumed ([HCPVAOM]KWp =45 eurokWp and DNIA = 1000 kW h(m2 year)) the value of theLCOE would be at around 0098 eurokW h In contrast if the best caseis assumed ([HCPVAOM]kWp = 15 eurokWp and DNIA = 2200 kW h(m2 year)) the value of the LCOE would be at around 0028 eurokW h

Finally Fig 8 shows the calculation of the LCOE as a function ofthe nominal discount rate for the same values of the annual directnormal irradiation previously considered If the worst case isassumed (d = 8 and DNIA = 1000 kW h(m2 year)) the value ofthe LCOE would be at around 0101 eurokW h At the same time ifthe best case is assumed (d = 2 and DNIA = 2200 kW h(m2 year))the value of the LCOE would be at around 0031 eurokW h

The influence on the LCOE of HCPV systems of the variations ofthree different factors was conducted above It is also interestingto compare the influence of these factors on the estimated valueof the LCOE of HCPV systems To carry out this analysis the basecase of the future scenario (Table 9) and a typical DNIA of

Fig 9 Difference between the LCOE of HCPV and conventional PV systems in the future scenario analysed (2020)

DL Talavera et al Applied Energy 151 (2015) 49ndash59 57

1800 kW h(m2 year) were considered In this case the LCOE is0043 eurokW h At the same time the value of [HCPVI]kWp[HCPVAOM]KWp or d where varied a +20 respectively while the restof the factors involved in the analysis were kept constant Based onthis analysis a value of LCOE = 0046 eurokW h was obtained consid-ering the individual variation of [HCPVAOM]KWp or d and a valueof LCOE = 0048 eurokW h was obtained considering the individualvariation of [HCPVI]kWp Thus it can be concluded that LCOE has asimilar sensitivity to the variations of [HCPVAOM]KWp and d and dif-ferent and larger sensitivity to the variations of [HCPVI]kWp

Fig 9 shows the difference between the LCOE of HCPV and con-ventional PV systems in the future scenario examined in this paper(2020) The LCOE of both technologies has been estimated solvingthe equations and following the procedure outlined in Section 2together with the figures shown in Table 9 in a spreadsheet Theannual electricity yield by a conventional PV system with the pan-els optimally inclined over the horizontal and permanently ori-ented southward was estimated using Eq (8) considering aperformance ratio of 075 In Fig 9 positive values indicate thatthe LCOE of HCPV systems is higher than the LCOE of conventionalPV systems while negative values indicate that the LCOE of HCPVsystems is lower than the LCOE of conventional PV systems In thisfuture scenario (2020) the calculated LCOE of conventional PV sys-tems varies from 0037 to 0064 eurokW h for locations with a Hopt

from 2043 (location number 1 Table 2) to 1171 kW h(m2 year)(location number 3 Table 2) respectively The blue areas of themap located in the south middle and northeast of the map repre-sent locations where the LCOE of HCPV systems is lower than theLCOE of conventional PV systems (e g locations number 1 2 and4 Table 2) As can be seen there are a wide number of areas whereHCPV would be a more profitable technology from an economicpoint of view The green areas of the map represent locationswhere the values of the LCOE for HCPV and conventional PV

systems are the same which indicate that both technologies canrepresent a similar economic profitability Also there are a widenumber of areas where the LCOE of HCPV systems are higher thanthe LCOE of conventional PV systems (e g location number 3 and5 Table 2) in which conventional PV technology is a more prof-itable investment from an economic point of view These locationsare mainly located in the north of Spain and can be explained dueto the low annual direct normal irradiation levels which cause lowannual energy yields as shown in Fig 1

5 Conclusions

The economic feasibility of HCPV systems is increasingly beingevaluated using the levelised cost of electricity (LCOE) generationin order to be compared to other electricity generation technolo-gies This is vital in terms of industrial perspective in order to anal-yse the potential of this young technology In this paper an analysisof the LCOE of HCPV systems has been carried out in Spain Theresults obtained are shown in an innovative set of maps

According to the cost analysis HCPV systems at locationswith annual direct normal irradiation ranging from 2221 to982 kW h(m2 year) reached a LCOE ranging from 0081 up018 eurokW h in 2013 Also considering a positive market evaluationover the next few years In 2020 HCPV systems could reach a LCOEvalue ranging from 0035 to 0080 eurokW h from the maximum tominimum the annual direct normal irradiation values

Considering a future scenario in which the initial investmentcost for conventional PV and HCPV systems is the same it can bealso concluded that PV is not a more profitable technology thanHCPV for the whole of Spain -from an economic point of view-The selection of the technology for a specific location will mainlydepend on its annual direct and global irradiation In the case of

58 DL Talavera et al Applied Energy 151 (2015) 49ndash59

Spain an area located in the southwest and northeast where HCPVwould represent a more profitable investment and another arealocated in the north where conventional PV systems would be amore profitable investment It is also important to note thatalthough this analysis has been carried out for Spain this conclu-sion can be extended for other regions worldwide

Future owners and potential investors of HCPV systems demandvaluable information about the economic feasibility of their invest-ment so one aim of this document is to provide information aboutthe LCOE of HCPV systems with power higher than 1 MWpFurthermore Spanish governmental bodies which are involved inthe design or selection of the support mechanisms addressed toHCPV may be enlightened by the results of the present paper

Appendix A Terminology

[HCPVAOM]kWp

Normalized per-kWp annual operationand maintenance cost of the HCPV system(euro)

[HCPVI]kWp

Normalized per-kWp initial investmentcost of HCPV (eurokWp)

[PVAOM]kWp

Normalized per-kWp annual operationand maintenance cost of the PV system(euro)

[PVI]kWp

Normalized per-kWp initial investmentcost of PV (eurokWp)

d

Nominal discount rate ()

dec

Annual dividend the equity capital ndash

return on equityndash ()

DEP

Annual tax depreciation (euro)

DNIA

Annual Direct Normal Irradiation

(kW h(m2 year))

DNISTC

Direct Normal Irradiation in Standard Test

Condition (1 kW hm2)

GSTC

Global Irradiance in Standard Test

Condition (1 kWm2)

HCPVAOM

Annual operation and maintenance cost

of the HCPV system (euro)

HCPVec

Amount equal to the portion of the initial

investment financed with equity capital(euro)

HCPVI

Initial investment cost on the HCPVsystem (euro)

HCPVl

Amount equal to the portion of the initialinvestment financed with loan (euro)

Hopt A

Annual Global Irradiation on optimallyinclined plane (kW h(m2 year))

i

Annual inflation rate ()

il

Annual loan interest ()

LCC

Life cycle cost of the HCPV system (euro)

LCOE

Levelised cost of electricity (eurokW h)

LR

Learning rate

N

Life cycle of the HCPV system equal to

analysis period (years)

Nd

Tax life for depreciation (years)

Nl

Amortization of loan (years)

PR

Performance ratio ()

PW [DEP]

Present worth of the tax depreciation (euro)

PW [HCPVOM (N)]

Present worth of the HCPV system

operation and maintenance cost (euro)

q

Factor equal to (11 + d)

QHCPV

HCPV world cumulative installed capacity

QA

Annual growth installed capacity ()

rd

Annual degradation rate in the efficiencyof the HCPV panels ()

rOampM

Annual escalation rate of the operationand maintenance cost of the HCPV system()

SV

Salvage value of the system at the end oftheir life cycle (euro)

T

Income tax rate ()

WACC

Weighted Average Cost of Capital ()

YHCPV

Final AC annual energy yield in a HCPV

grid connected system (kW h(kWp year)

YPV

Final AC annual energy yield in a

conventional fixed FV grid connectedsystem kW h(kWp year)

References

[1] Muntildeoz E Vidal PG Nofuentes G Hontoria L Peacuterez-Higueras P Terrados J et alCPV standardization An overview Renew Sustain Energ Rev 201014518ndash23

[2] International Electrotechnical Commission IEC 62108 Concentratorphotovoltaic (CPV) modules and assemblies ndash design qualification and typeapproval Edition 10 Geneve 2007

[3] Globaldata Concentrated Photovoltaics (CPV) ndash Global market sizecompetitive landscape and key country analysis to 2020 UK 2014

[4] Fernaacutendez EF Peacuterez-Higueras P Garcia Loureiro AJ Vidal PG Outdoor evaluationof concentrator photovoltaic systems modules from different manufacturersFirst results and steps Prog Photovoltaics Res Appl 201321693ndash701

[5] Danchev S Maniatis G Tsakanikas A Returns on investment in electricityproducing photovoltaic systems under de-escalating feed-in tariffs The case ofGreece Renew Sustain Energy Rev 201014500ndash5

[6] Spertino F Di Leo P Cocina V Economic analysis of investment in the rooftopphotovoltaic systems A long-term research in the two main markets RenewSustain Energy Rev 201328531ndash40

[7] Talavera DL Muntildeoz-Ceroacuten E De La Casa J Ortega MJ Almonacid G Energy andeconomic analysis for large-scale integration of small photovoltaic systems inbuildings The case of a public location in Southern Spain Renew SustainEnergy Rev 2011154310ndash9

[8] Talavera DL de la Casa J Muntildeoz-Ceroacuten E Almonacid G Grid parity and self-consumption with photovoltaic systems under the present regulatoryframework in Spain The case of the University of Jaeacuten Campus RenewSustain Energy Rev 201433752ndash71

[9] Drury E Denholm P Margolis R The impact of different economic performancemetrics on the perceived value of solar photovoltaics October 2011 TechnicalReport NRELTP-6A20-52197

[10] Reddy KS Veershetty G Viability analysis of solar parabolic dish stand-alonepower plant for Indian conditions Appl Energy 2013102908ndash22

[11] Branker K Pathak MJM Pearce JM A review of solar photovoltaic levelized costof electricity Renew Sustain Energy Rev 2011154470ndash82

[12] Eclareon SL PV grid parity monitor residential sector 2nd issue May 2013 p40ndash2

[13] Fraunhofer institute for solar energy systems ISE Levelized cost of electricityrenewable energy technologies November 2013

[14] Fraisopi F The CPV market An industry perspective GTM Research IntersolarMuumlnchen June 2013

[15] Daniilidis A Herber R Vermaas DA Upscale potential and financial feasibilityof a reverse electrodialysis power plant Appl Energy 2014119257ndash65

[16] Goumlkccedilek M Genccedil MS Evaluation of electricity generation and energy cost ofwind energy conversion systems (WECSs) in Central Turkey Appl Energy2009862731ndash9

[17] Desideri U Campana PE Analysis and comparison between a concentratingsolar and a photovoltaic power plant Appl Energy 2014113422ndash33

[18] Hernaacutendez-Moro J Martiacutenez-Duart JM Analytical model for solar PV and CSPelectricity costs Present LCOE values and their future evolution RenewSustain Energy Rev 201320119ndash32

[19] International Renewable Energy Agency (IRENA) Renewable power generationcosts in 2012 An overview 2013 IRENA report ltwwwirenaorgPublicationsgt

[20] Short W Packey DJ Holt T A manual for the economic evaluation of energyefficiency and renewable energy technologies NRELTPndash462-5173 NationalRenewable Energy Laboratory 1995 p 1ndash120

[21] European photovoltaic industry association Solar photovoltaics competing inthe energy sector On the road to competitiveness 2011 lthttpwwwepiaorgnewspublicationsgt

[22] Swift KD A comparison of the cost and financial returns for solar photovoltaicsystems installed by businesses in different locations across the United StatesRenewable Energy 201357137ndash43

[23] Nishikawa Wea LCOE concentrating photovoltaic for CPV ICSC5 Conference2008

Fig 9 Difference between the LCOE of HCPV and conventional PV systems in the future scenario analysed (2020)

DL Talavera et al Applied Energy 151 (2015) 49ndash59 57

1800 kW h(m2 year) were considered In this case the LCOE is0043 eurokW h At the same time the value of [HCPVI]kWp[HCPVAOM]KWp or d where varied a +20 respectively while the restof the factors involved in the analysis were kept constant Based onthis analysis a value of LCOE = 0046 eurokW h was obtained consid-ering the individual variation of [HCPVAOM]KWp or d and a valueof LCOE = 0048 eurokW h was obtained considering the individualvariation of [HCPVI]kWp Thus it can be concluded that LCOE has asimilar sensitivity to the variations of [HCPVAOM]KWp and d and dif-ferent and larger sensitivity to the variations of [HCPVI]kWp

Fig 9 shows the difference between the LCOE of HCPV and con-ventional PV systems in the future scenario examined in this paper(2020) The LCOE of both technologies has been estimated solvingthe equations and following the procedure outlined in Section 2together with the figures shown in Table 9 in a spreadsheet Theannual electricity yield by a conventional PV system with the pan-els optimally inclined over the horizontal and permanently ori-ented southward was estimated using Eq (8) considering aperformance ratio of 075 In Fig 9 positive values indicate thatthe LCOE of HCPV systems is higher than the LCOE of conventionalPV systems while negative values indicate that the LCOE of HCPVsystems is lower than the LCOE of conventional PV systems In thisfuture scenario (2020) the calculated LCOE of conventional PV sys-tems varies from 0037 to 0064 eurokW h for locations with a Hopt

from 2043 (location number 1 Table 2) to 1171 kW h(m2 year)(location number 3 Table 2) respectively The blue areas of themap located in the south middle and northeast of the map repre-sent locations where the LCOE of HCPV systems is lower than theLCOE of conventional PV systems (e g locations number 1 2 and4 Table 2) As can be seen there are a wide number of areas whereHCPV would be a more profitable technology from an economicpoint of view The green areas of the map represent locationswhere the values of the LCOE for HCPV and conventional PV

systems are the same which indicate that both technologies canrepresent a similar economic profitability Also there are a widenumber of areas where the LCOE of HCPV systems are higher thanthe LCOE of conventional PV systems (e g location number 3 and5 Table 2) in which conventional PV technology is a more prof-itable investment from an economic point of view These locationsare mainly located in the north of Spain and can be explained dueto the low annual direct normal irradiation levels which cause lowannual energy yields as shown in Fig 1

5 Conclusions

The economic feasibility of HCPV systems is increasingly beingevaluated using the levelised cost of electricity (LCOE) generationin order to be compared to other electricity generation technolo-gies This is vital in terms of industrial perspective in order to anal-yse the potential of this young technology In this paper an analysisof the LCOE of HCPV systems has been carried out in Spain Theresults obtained are shown in an innovative set of maps

According to the cost analysis HCPV systems at locationswith annual direct normal irradiation ranging from 2221 to982 kW h(m2 year) reached a LCOE ranging from 0081 up018 eurokW h in 2013 Also considering a positive market evaluationover the next few years In 2020 HCPV systems could reach a LCOEvalue ranging from 0035 to 0080 eurokW h from the maximum tominimum the annual direct normal irradiation values

Considering a future scenario in which the initial investmentcost for conventional PV and HCPV systems is the same it can bealso concluded that PV is not a more profitable technology thanHCPV for the whole of Spain -from an economic point of view-The selection of the technology for a specific location will mainlydepend on its annual direct and global irradiation In the case of

58 DL Talavera et al Applied Energy 151 (2015) 49ndash59

Spain an area located in the southwest and northeast where HCPVwould represent a more profitable investment and another arealocated in the north where conventional PV systems would be amore profitable investment It is also important to note thatalthough this analysis has been carried out for Spain this conclu-sion can be extended for other regions worldwide

Future owners and potential investors of HCPV systems demandvaluable information about the economic feasibility of their invest-ment so one aim of this document is to provide information aboutthe LCOE of HCPV systems with power higher than 1 MWpFurthermore Spanish governmental bodies which are involved inthe design or selection of the support mechanisms addressed toHCPV may be enlightened by the results of the present paper

Appendix A Terminology

[HCPVAOM]kWp

Normalized per-kWp annual operationand maintenance cost of the HCPV system(euro)

[HCPVI]kWp

Normalized per-kWp initial investmentcost of HCPV (eurokWp)

[PVAOM]kWp

Normalized per-kWp annual operationand maintenance cost of the PV system(euro)

[PVI]kWp

Normalized per-kWp initial investmentcost of PV (eurokWp)

d

Nominal discount rate ()

dec

Annual dividend the equity capital ndash

return on equityndash ()

DEP

Annual tax depreciation (euro)

DNIA

Annual Direct Normal Irradiation

(kW h(m2 year))

DNISTC

Direct Normal Irradiation in Standard Test

Condition (1 kW hm2)

GSTC

Global Irradiance in Standard Test

Condition (1 kWm2)

HCPVAOM

Annual operation and maintenance cost

of the HCPV system (euro)

HCPVec

Amount equal to the portion of the initial

investment financed with equity capital(euro)

HCPVI

Initial investment cost on the HCPVsystem (euro)

HCPVl

Amount equal to the portion of the initialinvestment financed with loan (euro)

Hopt A

Annual Global Irradiation on optimallyinclined plane (kW h(m2 year))

i

Annual inflation rate ()

il

Annual loan interest ()

LCC

Life cycle cost of the HCPV system (euro)

LCOE

Levelised cost of electricity (eurokW h)

LR

Learning rate

N

Life cycle of the HCPV system equal to

analysis period (years)

Nd

Tax life for depreciation (years)

Nl

Amortization of loan (years)

PR

Performance ratio ()

PW [DEP]

Present worth of the tax depreciation (euro)

PW [HCPVOM (N)]

Present worth of the HCPV system

operation and maintenance cost (euro)

q

Factor equal to (11 + d)

QHCPV

HCPV world cumulative installed capacity

QA

Annual growth installed capacity ()

rd

Annual degradation rate in the efficiencyof the HCPV panels ()

rOampM

Annual escalation rate of the operationand maintenance cost of the HCPV system()

SV

Salvage value of the system at the end oftheir life cycle (euro)

T

Income tax rate ()

WACC

Weighted Average Cost of Capital ()

YHCPV

Final AC annual energy yield in a HCPV

grid connected system (kW h(kWp year)

YPV

Final AC annual energy yield in a

conventional fixed FV grid connectedsystem kW h(kWp year)

References

[1] Muntildeoz E Vidal PG Nofuentes G Hontoria L Peacuterez-Higueras P Terrados J et alCPV standardization An overview Renew Sustain Energ Rev 201014518ndash23

[2] International Electrotechnical Commission IEC 62108 Concentratorphotovoltaic (CPV) modules and assemblies ndash design qualification and typeapproval Edition 10 Geneve 2007

[3] Globaldata Concentrated Photovoltaics (CPV) ndash Global market sizecompetitive landscape and key country analysis to 2020 UK 2014

[4] Fernaacutendez EF Peacuterez-Higueras P Garcia Loureiro AJ Vidal PG Outdoor evaluationof concentrator photovoltaic systems modules from different manufacturersFirst results and steps Prog Photovoltaics Res Appl 201321693ndash701

[5] Danchev S Maniatis G Tsakanikas A Returns on investment in electricityproducing photovoltaic systems under de-escalating feed-in tariffs The case ofGreece Renew Sustain Energy Rev 201014500ndash5

[6] Spertino F Di Leo P Cocina V Economic analysis of investment in the rooftopphotovoltaic systems A long-term research in the two main markets RenewSustain Energy Rev 201328531ndash40

[7] Talavera DL Muntildeoz-Ceroacuten E De La Casa J Ortega MJ Almonacid G Energy andeconomic analysis for large-scale integration of small photovoltaic systems inbuildings The case of a public location in Southern Spain Renew SustainEnergy Rev 2011154310ndash9

[8] Talavera DL de la Casa J Muntildeoz-Ceroacuten E Almonacid G Grid parity and self-consumption with photovoltaic systems under the present regulatoryframework in Spain The case of the University of Jaeacuten Campus RenewSustain Energy Rev 201433752ndash71

[9] Drury E Denholm P Margolis R The impact of different economic performancemetrics on the perceived value of solar photovoltaics October 2011 TechnicalReport NRELTP-6A20-52197

[10] Reddy KS Veershetty G Viability analysis of solar parabolic dish stand-alonepower plant for Indian conditions Appl Energy 2013102908ndash22

[11] Branker K Pathak MJM Pearce JM A review of solar photovoltaic levelized costof electricity Renew Sustain Energy Rev 2011154470ndash82

[12] Eclareon SL PV grid parity monitor residential sector 2nd issue May 2013 p40ndash2

[13] Fraunhofer institute for solar energy systems ISE Levelized cost of electricityrenewable energy technologies November 2013

[14] Fraisopi F The CPV market An industry perspective GTM Research IntersolarMuumlnchen June 2013

[15] Daniilidis A Herber R Vermaas DA Upscale potential and financial feasibilityof a reverse electrodialysis power plant Appl Energy 2014119257ndash65

[16] Goumlkccedilek M Genccedil MS Evaluation of electricity generation and energy cost ofwind energy conversion systems (WECSs) in Central Turkey Appl Energy2009862731ndash9

[17] Desideri U Campana PE Analysis and comparison between a concentratingsolar and a photovoltaic power plant Appl Energy 2014113422ndash33

[18] Hernaacutendez-Moro J Martiacutenez-Duart JM Analytical model for solar PV and CSPelectricity costs Present LCOE values and their future evolution RenewSustain Energy Rev 201320119ndash32

[19] International Renewable Energy Agency (IRENA) Renewable power generationcosts in 2012 An overview 2013 IRENA report ltwwwirenaorgPublicationsgt

[20] Short W Packey DJ Holt T A manual for the economic evaluation of energyefficiency and renewable energy technologies NRELTPndash462-5173 NationalRenewable Energy Laboratory 1995 p 1ndash120

[21] European photovoltaic industry association Solar photovoltaics competing inthe energy sector On the road to competitiveness 2011 lthttpwwwepiaorgnewspublicationsgt

[22] Swift KD A comparison of the cost and financial returns for solar photovoltaicsystems installed by businesses in different locations across the United StatesRenewable Energy 201357137ndash43

[23] Nishikawa Wea LCOE concentrating photovoltaic for CPV ICSC5 Conference2008

58 DL Talavera et al Applied Energy 151 (2015) 49ndash59

Spain an area located in the southwest and northeast where HCPVwould represent a more profitable investment and another arealocated in the north where conventional PV systems would be amore profitable investment It is also important to note thatalthough this analysis has been carried out for Spain this conclu-sion can be extended for other regions worldwide

Future owners and potential investors of HCPV systems demandvaluable information about the economic feasibility of their invest-ment so one aim of this document is to provide information aboutthe LCOE of HCPV systems with power higher than 1 MWpFurthermore Spanish governmental bodies which are involved inthe design or selection of the support mechanisms addressed toHCPV may be enlightened by the results of the present paper

Appendix A Terminology

[HCPVAOM]kWp

Normalized per-kWp annual operationand maintenance cost of the HCPV system(euro)

[HCPVI]kWp

Normalized per-kWp initial investmentcost of HCPV (eurokWp)

[PVAOM]kWp

Normalized per-kWp annual operationand maintenance cost of the PV system(euro)

[PVI]kWp

Normalized per-kWp initial investmentcost of PV (eurokWp)

d

Nominal discount rate ()

dec

Annual dividend the equity capital ndash

return on equityndash ()

DEP

Annual tax depreciation (euro)

DNIA

Annual Direct Normal Irradiation

(kW h(m2 year))

DNISTC

Direct Normal Irradiation in Standard Test

Condition (1 kW hm2)

GSTC

Global Irradiance in Standard Test

Condition (1 kWm2)

HCPVAOM

Annual operation and maintenance cost

of the HCPV system (euro)

HCPVec

Amount equal to the portion of the initial

investment financed with equity capital(euro)

HCPVI

Initial investment cost on the HCPVsystem (euro)

HCPVl

Amount equal to the portion of the initialinvestment financed with loan (euro)

Hopt A

Annual Global Irradiation on optimallyinclined plane (kW h(m2 year))

i

Annual inflation rate ()

il

Annual loan interest ()

LCC

Life cycle cost of the HCPV system (euro)

LCOE

Levelised cost of electricity (eurokW h)

LR

Learning rate

N

Life cycle of the HCPV system equal to

analysis period (years)

Nd

Tax life for depreciation (years)

Nl

Amortization of loan (years)

PR

Performance ratio ()

PW [DEP]

Present worth of the tax depreciation (euro)

PW [HCPVOM (N)]

Present worth of the HCPV system

operation and maintenance cost (euro)

q

Factor equal to (11 + d)

QHCPV

HCPV world cumulative installed capacity

QA

Annual growth installed capacity ()

rd

Annual degradation rate in the efficiencyof the HCPV panels ()

rOampM

Annual escalation rate of the operationand maintenance cost of the HCPV system()

SV

Salvage value of the system at the end oftheir life cycle (euro)

T

Income tax rate ()

WACC

Weighted Average Cost of Capital ()

YHCPV

Final AC annual energy yield in a HCPV

grid connected system (kW h(kWp year)

YPV

Final AC annual energy yield in a

conventional fixed FV grid connectedsystem kW h(kWp year)

References

[1] Muntildeoz E Vidal PG Nofuentes G Hontoria L Peacuterez-Higueras P Terrados J et alCPV standardization An overview Renew Sustain Energ Rev 201014518ndash23

[2] International Electrotechnical Commission IEC 62108 Concentratorphotovoltaic (CPV) modules and assemblies ndash design qualification and typeapproval Edition 10 Geneve 2007

[3] Globaldata Concentrated Photovoltaics (CPV) ndash Global market sizecompetitive landscape and key country analysis to 2020 UK 2014

[4] Fernaacutendez EF Peacuterez-Higueras P Garcia Loureiro AJ Vidal PG Outdoor evaluationof concentrator photovoltaic systems modules from different manufacturersFirst results and steps Prog Photovoltaics Res Appl 201321693ndash701

[5] Danchev S Maniatis G Tsakanikas A Returns on investment in electricityproducing photovoltaic systems under de-escalating feed-in tariffs The case ofGreece Renew Sustain Energy Rev 201014500ndash5

[6] Spertino F Di Leo P Cocina V Economic analysis of investment in the rooftopphotovoltaic systems A long-term research in the two main markets RenewSustain Energy Rev 201328531ndash40

[7] Talavera DL Muntildeoz-Ceroacuten E De La Casa J Ortega MJ Almonacid G Energy andeconomic analysis for large-scale integration of small photovoltaic systems inbuildings The case of a public location in Southern Spain Renew SustainEnergy Rev 2011154310ndash9

[8] Talavera DL de la Casa J Muntildeoz-Ceroacuten E Almonacid G Grid parity and self-consumption with photovoltaic systems under the present regulatoryframework in Spain The case of the University of Jaeacuten Campus RenewSustain Energy Rev 201433752ndash71

[9] Drury E Denholm P Margolis R The impact of different economic performancemetrics on the perceived value of solar photovoltaics October 2011 TechnicalReport NRELTP-6A20-52197

[10] Reddy KS Veershetty G Viability analysis of solar parabolic dish stand-alonepower plant for Indian conditions Appl Energy 2013102908ndash22

[11] Branker K Pathak MJM Pearce JM A review of solar photovoltaic levelized costof electricity Renew Sustain Energy Rev 2011154470ndash82

[12] Eclareon SL PV grid parity monitor residential sector 2nd issue May 2013 p40ndash2

[13] Fraunhofer institute for solar energy systems ISE Levelized cost of electricityrenewable energy technologies November 2013

[14] Fraisopi F The CPV market An industry perspective GTM Research IntersolarMuumlnchen June 2013

[15] Daniilidis A Herber R Vermaas DA Upscale potential and financial feasibilityof a reverse electrodialysis power plant Appl Energy 2014119257ndash65

[16] Goumlkccedilek M Genccedil MS Evaluation of electricity generation and energy cost ofwind energy conversion systems (WECSs) in Central Turkey Appl Energy2009862731ndash9

[17] Desideri U Campana PE Analysis and comparison between a concentratingsolar and a photovoltaic power plant Appl Energy 2014113422ndash33

[18] Hernaacutendez-Moro J Martiacutenez-Duart JM Analytical model for solar PV and CSPelectricity costs Present LCOE values and their future evolution RenewSustain Energy Rev 201320119ndash32

[19] International Renewable Energy Agency (IRENA) Renewable power generationcosts in 2012 An overview 2013 IRENA report ltwwwirenaorgPublicationsgt

[20] Short W Packey DJ Holt T A manual for the economic evaluation of energyefficiency and renewable energy technologies NRELTPndash462-5173 NationalRenewable Energy Laboratory 1995 p 1ndash120

[21] European photovoltaic industry association Solar photovoltaics competing inthe energy sector On the road to competitiveness 2011 lthttpwwwepiaorgnewspublicationsgt

[22] Swift KD A comparison of the cost and financial returns for solar photovoltaicsystems installed by businesses in different locations across the United StatesRenewable Energy 201357137ndash43

[23] Nishikawa Wea LCOE concentrating photovoltaic for CPV ICSC5 Conference2008

DL Talavera et al Applied Energy 151 (2015) 49ndash59 59

[24] Ruiz-Arias JA Quesada-Ruiz S Fernaacutendez EF Gueymard CA Optimalcombination of gridded and ground-observed solar radiation data forregional solar resource assessment Sol Energy 2015112411ndash24

[25] Lohmann S Schillings C Mayer B Meyer R Long-term variability of solar directand global radiation derived from ISCCP data and comparison with reanalysisdata Sol Energy 2006801390ndash401

[26] Rus-Casas C Aguilar JD Rodrigo P Almonacid F Peacuterez-Higueras PJClassification of methods for annual energy harvesting calculations ofphotovoltaic generators Energy Convers Manage 201478527ndash36

[27] Leloux J Lorenzo E Garciacutea-Domingo B Aguilera J Gueymard CA A bankablemethod of assessing the performance of a CPV plant Appl Energy20141181ndash11

[28] International Electrotechnical Commission (IEC) IEC 61724 Photovoltaicsystem performance monitoring ndash Guidelines for measurement dataexchange and analysis First edition 1998ndash04 1998

[29] Ruiz-Arias JA Terrados J Peacuterez-Higueras P Pozo-Vaacutezquez D Almonacid GAssessment of the renewable energies potential for intensive electricityproduction in the province of Jaeacuten southern Spain Renew Sustain Energ Rev2012162994ndash3001

[30] Drif M Peacuterez PJ Aguilera J Almonacid G Gomez P de la Casa J et al Univerproject A grid connected photovoltaic system of at Jaeacuten University Overviewand performance analysis Solar Energy Mater Solar Cells 200791670ndash83

[31] Ransome SJ Wohlgemuth JH Solar BP kW hkWp dependency on PVtechnology and balance of systems performance Conf Rec IEEE PhotovoltaicSpec Conf 20021420ndash3

[32] Mondol JD Yohanis YG Smyth M Norton B Performance analysis of a frid-connected building integrated photovoltaic system 2003 ISES Solar WorldCongress Goumlteborg Sweden 2003

[33] Šuacuteri M Huld TA Dunlop ED Ossenbrink HA Potential of solar electricitygeneration in the European Union member states and candidate countries SolEnergy 2007811295ndash305

[34] King C Site data analysis of CPV plants In Photovoltaic Specialists Conference(PVSC) 35th IEEE 2010 p 3043ndash7

[35] Stone Kea Analysis of five years of field performance of the Amonix highconcentration PV system In Proceedings of the power-gen renewableconference 2006

[36] Kinsey GS Stone K Brown J Garboushian V Energy prediction of Amonix CPVsolar power plants Prog Photovoltaics Res Appl 201119794ndash6

[37] Hea Husna Impact of spectral irradiance distribution and temperature on theoutdoor performance of concentrator photovoltaic system AIP Conf Proc20131556 httpdxdoiorg10106314822243252-255

[38] Lecoufle D Kuhn F A place for PV tracked-PV and CPV In 2nd Internationalworkshop on concentrating photovoltaic power plants Germany 2009

[39] Nishikawa W Horne S Key advantages of concentrating photovoltaics (CPV)for lowering levelized cost of electricity (LCOE) In Proceedings of the 23rdEuropean PV solar energy conference Valencia 2008 p 3765ndash7

[40] Verlinden P Lasich J Energy rating of concentrator PV systems using multi-junction IIIndashV solar cells In Photovoltaic specialists conference 33rd IEEE2008

[41] Goacutemez-Gil FJ Wang X Barnett A Energy production of photovoltaic systemsFixed tracking and concentrating Renew Sustain Energ Rev 201216306ndash13

[42] Consortium C Concentrator Photovoltaic (CPV) workshop Understanding thetechnology and related implications for scaled deployment Dallas SolarPower International 2011

[43] Magpower Performance in practice CPV versus PV 15 year of operation In3rd concentrated photovoltaic summit USA 2011

[44] King B Riley D Hansen C Erdman M Gabriel J Ghosal K HCPVcharacterization analysis of fielded system data In AIP conferenceproceedings vol 1616 2014 p 276ndash9

[45] Skamarock WC Klemp JB Dudhia J Gill DO Barker DMea A description of theadvanced research WRF version 3 Tech Rep NCARTN-475+STR NationalCenter for Atmospheric Research 2008

[46] Ruiz-Arias JA Dudhia J Santos-Alamillos FJ Pozo-Vaacutezquez D Surface clear-skyshortwave radiative closure intercomparisons in the weather research andforecasting model J Geophys Res D Atmos 20131189901ndash13

[47] Ruiz-Arias JA Dudhia J Gueymard CA A simple parameterization of the short-wave aerosol optical properties for surface direct and diffuse irradiancesassessment in a numerical weather model Geosci Model Dev201471159ndash74 httpdxdoiorg105194gmd-7-1159-2014

[48] NREL Energy technology cost and performance data for distributed generation2013 (August) 2014 lthttpwwwnrelgovanalysistech_lcoe_re_cost_esthtmlgt

[49] Global ratescom Inflation ndash summary of current international inflationfigures 2013 httpwwwglobal-ratescomeconomic-indicatorsinflationinflationaspx [accessed 2013]

[50] European Central Bank Inflaction in the Euro area 2014 lthttpwwwecbeuropaeustatspriceshicphtmlinflationenhtmlgt [accessed 0714]

[51] Trading economics Inflation rate-countries-list 2015 lthttpwwwtradingeconomicscomcountry-listinflation-rategt [accessed 0115]

[52] The World bank Inflation consumer prices (annual) 2015lthttpdataworldbankorgindicatorFPCPITOTLZGpage=1gt [accessed 0115]

[53] Instituto Nacional de Estadistica (INE) Tipos de intereacutes legales del mercadohipotecario y del mercado financiero 2013 lthttpwww ine esjaxitabladopath=t38bme2t30b092l0ampfile=0902001 pxamptype=pcaxisampL=0 2013gt

[54] Banco de Espantildea Tipos de intereacutes de preacutestamos y creacuteditos a las sociedades nofinancieras 2014 lthttpwwwbdeeswebbdeesestadisinfoestbolest19htmlgt [accessed 2014]

[55] Ministry economic Spain Royal Decree 17772004 Ministry economic RD17772004 BOE number 189 2004 p 28377ndash429

[56] Thonson Reuters Consulta AEAT 128308 IS Central fotovoltaicaAmortizacioacuten 2014 lthttpportaljuridicolexnovaesdoctrinaadministrativaJURIDICO77405consulta-aeat-128308-is-central-fotovoltaica-amortizaciongt

[57] Jordan DC Kurtz SR Photovoltaic degradation rates ndash An analytical reviewProg Photovoltaics Res Appl 20132112ndash29

[58] Drury E Lopez A Denholm P Margolis R Relative performance of trackingversus fixed tilt photovoltaic systems in the USA Prog Photovoltaics Res Appl2013

[59] Hartsoch N Concentrating PV ndash More energy production for low costelectricity Solfocus Inc 2011

[60] Prior B Cost and LCOE by generation technology 2009ndash2020 GTM researchNovember 2011

[61] European Photovoltaic Industry Association (EPIA) Solar generation 6 Solarphotovoltaic energy empowering the world 2011 lthttpwwwepiaorguploadstx_epiapublicationsSolar_Generation_6__2011_Full_report_Finalpdfgt [accessed 0714]

[62] International Energy Agency (IEA) Technology roadmap solar photovoltaicenergy 2010 lthttpwwwieaorgpublicationsfreepublicationspublicationpv_roadmappdfgt [accessed 0714]

[63] Peacuterez-Higueras P Muntildeoz E Almonacid Gea Proposal of a Spanish CPV feed-intariff In 6th International conference on concentrating photovoltaic systemsFreiburg (Germany) 2010 lthttpdxdoiorg10106313509225gt [accessed0714]

[64] Green MA Emery K Hishikawa Y Warta W Dunlop ED Solar cell efficiencytables (version 44) Prog Photovoltaics Res Appl 201422701ndash10

[65] Peacuterez-Higueras P Muntildeoz E Almonacid G Vidal PG High concentratorphotovoltaics efficiencies present status and forecast Renew Sustain EnergRev 2011151810ndash5

[66] IHS Solar Solution Concentrated PV (CPV) Report 2013 ndash CPV on the edge ofmarket breakthrough USA 2013

[67] Mints P The current status of CPV 2013 PV-insider UK 2013[68] Bhandari R Stadler I Grid parity analysis of solar photovoltaic systems in

Germany using experience curves Sol Energy 2009831634ndash44[69] Poponi D Analysis of diffusion paths for photovoltaic technology based on

experience curves Sol Energy 200374331ndash40[70] Parente V Goldemberg J Zilles R Comments on experience curves for PV

modules Prog Photovoltaics Res Appl 200210571ndash4[71] Harmon C Experience curves of photovoltaic technology In International

institute for applied system analysis Laxenburg Austria 2000[72] International Energy Agency (IEA) Experience curves for energy technology

policy OECD IEA Paris 2000

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