PV System Costs

To view the PV System Costs page, select a photovoltaic technology, and click PV System Costs on the main window's navigation menu. Note that for the Array page to be available, the technology option in the Technology and Market window must be Photovoltaics - SAM Performance Models or Photovoltaics - PVWatts Performance Model.

Solar Advisor uses the variables on the PV System Costs page to calculate the project investment cost and annual operating costs reported in the project cash flow and used to calculate cost metrics.

Variable values in boxes with white backgrounds are values that you can edit. Boxes with blue backgrounds contain calculated values or values from other pages that Solar Advisor displays for your information.

The PV System Costs page is divided into four main categories. The first two, Direct Capital Costs and Indirect Capital Costs, are summed in the third category, Total Installed Costs. Because only the Total Installed Cost value affects the cash flow calculations, you can assign capital costs to the different cost categories in whatever way makes sense for your analysis. For example, you could assign the cost of designing the array to the module cost category or to the engineer-procure-construct category with equivalent results. The categories are provided to help you keep track of the different costs, but do not affect the economic calculations. After assigning costs to the categories, verify that the total installed costs value is what you expect. The fourth category of costs covers Operation and Maintenance.

Note: The cost values in the sample files are intended to illustrate Solar Advisor's use. The cost data are meant to be realistic, but not to represent actual costs for a specific project. Actual costs will, of course, vary. Because of price volatility in solar markets, the cost data in the sample files is likely to be out of date. For more information see the Solar Advisor Model website, https://www.nrel.gov/analysis/sam/cost_data.html.

Contents

►	Input Variable Reference describes the input variables on the PV System Costs page.

►	Entering Periodic Costs explains how to use annual schedules to assign operation and maintenance costs to particular years in the project cash flow.

Input Variable Reference

Direct Capital Costs

A direct capital cost represents an expense for a specific piece of equipment or installation service that applies in year zero of the cash flow.

Note: Because Solar Advisor uses only the Total Installed Cost value in cash flow calculations, how you distribute costs among the different direct capital cost categories does not affect the final results.

Variable

Description

Units

Module

For the SAM Performance model options, the cost is expressed per unit or per DC Watt. The total module cost is calculated as either:

•	Dollars per watt multiplied by Total Array Power on the Array page, or

•	Dollars per unit multiplied by Total Modules on the Array page.

For the PVWatts Performance Model, the cost is expressed per unit or per DC Watt. the total module cost is calculated as either:

•	Dollars per watt multiplied by DC Rating on the PVWatts Solar Array page, or

•	Dollars per unit multiplied, where the number of modules is assumed to be one.

$/Wdc or $/Unit

Inverter

For the SAM Performance Model options, the cost of inverters in the system expressed in dollars per AC Watt or dollars per inverter. The total inverter cost is either:

•	Dollars per watt multiplied by Total Inverter Capacity on the Array page, or

•	Dollars per unit multiplied by Number of Inverters on the Array page.

For the PVWatts Performance Model, the cost of an inverter in the system in dollars per watt or dollars per inverter. The total cost is calculated as either:

•	Dollars per watt multiplied by DC Rating on the PVWatts Solar Array page, or

•	Dollars per unit where the number of inverters is assumed to be one.

$/Wac or $/Unit

Battery

The cost of batteries in the system, expressed as the sum of a fixed cost and cost per kilowatt-hour of storage capacity. The total storage capacity is equal to Total Battery Capacity on the PV Storage page.

$ and $/kWh

Balance of System, Fixed

A fixed cost that can be used to account for costs not included in the module, inverter and battery cost categories, for example, the mounting racks, junction boxes, and wiring.

Installation, Fixed

A fixed cost that can be used to account for labor or other costs not included in the other cost categories.

Contingency

A percentage of the sum of the module, inverter, battery, balance of system, and installation costs to account for expected uncertainties in direct cost estimates.

Total Direct Cost

The sum of module, inverter, battery, balance of system, installation, and contingency costs.

Indirect Capital Costs

An indirect cost is typically one that cannot be identified with a specific piece of equipment or installation service, and may include all other costs that are built into the price of the system, such as profit, overhead, and shipping costs. Depending on the purpose of your analysis, you may decide to distribute profit among the direct cost categories or include them as a single value in an indirect category.

Note: Because Solar Advisor uses only the total installed cost value in cash flow calculations, how you distribute costs among the different indirect capital cost categories does not affect the final results.

Variable	Description	Units
Engineer, Procure, Construct	Costs associated with design and construction of the project, calculated as the sum of a percentage of Total Direct Cost and a fixed cost.	% and $
Project, Land, Miscellaneous	Costs associated with profit, overhead (including marketing), permitting, or shipping, calculated as the sum of a percentage of Total Direct Cost and a fixed cost.	% and $
Sales Tax	Percentage of direct costs to which sales tax applies, calculated by multiplying Total Direct Cost by the sales tax rate from the Financials page and the percentage that you specify.	%
Total Indirect Cost	The sum of Engineer-Procure-Construct costs, Project-Land-Miscellaneous costs, and sales tax.	$

Total Installed Cost

The total installed cost is the project's investment cost that applies in year zero of the project cash flow. Solar Advisor uses this value to calculate loan amounts and debt interest payments based on inputs on the Financing page, and to calculate tax credit and incentive payment amounts for incentive based tax credits and incentives defined on the Tax Credit Incentives page and Payment Incentives pages.

Variable	Description	Units
Total Installed Cost	The sum of total direct cost and total indirect cost.	$
Total Installed Cost per Capacity	Total installed cost divided by the total system capacity in Watts-DC of array capacity for PV systems and electric kilowatts of power block nameplate capacity for CSP systems. This value is provided for reference only and not used in cash flow calculations.	$/Wdc or $/kW

Operation and Maintenance Costs

Operation and Maintenance (O&M) costs represent annual expenditures on equipment and services that occur after the system is installed. Solar Advisor allows you to enter O&M costs in three ways: Fixed annual, fixed by capacity, and variable by generation. O&M costs are reported on the project cash flow.

For each O&M cost category, you can specify an annual escalation rate to represent an expected annual increase in O&M cost above the annual inflation rate specified on the Financing page. For an escalation rate of zero, the O&M cost in years two and later is the year one cost adjusted for inflation. For a non-zero escalation rate, the O&M cost in years two and later is the year one cost adjusted for inflation plus escalation.

For expenses such as component replacements that occur in particular years, you can use an annual schedule to assign costs to individual years. See below for details.

O&M Cost Category	Description	Units
Fixed Annual Cost	A fixed annual cost applied to each year in the project cash flow.	$/yr
Fixed Cost by Capacity	A fixed annual cost proportional to the array capacity in DC kilowatts.	$/kWdc-yr
Variable Cost by Generation	A variable annual cost proportional to the system's total annual electrical output in AC megawatt-hours. The annual output depends on either the performance model's calculated first year value and the degradation rate specified on the Annual Performance page, or on an annual schedule of costs, depending on the option chosen.	$/MWh-yr
Fossil Fuel Cost	The cost per million British thermal units for fuel. Solar Advisor uses the conversion factor 1 MWh = 3.413 MMBtu. Applies only to the generic fossil, CSP trough, and CSP tower systems. The photovoltaic and CSP dish models ignore the fuel cost input variable. (When the fossil fill fraction variable on the Thermal Storage page for troughs or towers is greater than zero, the systems consume fuel for backup energy.)	$/MMBtu

Entering Periodic Costs

Solar Advisor allows you to specify any of the four operation and maintenance cost categories as an annual schedule of costs. An annual schedule makes it possible to assign a cost to particular years in the analysis period. Annual schedules can be used to account for inverter replacement costs and other periodic costs that do not recur on a regular annual basis. Note that you cannot have both a regularly occurring cost in addition to an annual schedule of costs. Solar Advisor will use whatever option is valid as indicated by a blue highlight on the “Value” button (regularly occurring) or “Sched” button (annual schedule) to determine which values are used in the model.

For example, to account for inverter replacement costs, you can specify the fixed annual cost category as an annual schedule, and assign the cost of replacing or rebuilding inverters to particular years. For a 30-year project using an inverter with a seven-year life, you would assign a replacement cost to years seven, 14, and 21. Or, to account for expected improvements in inverter reliability in the future, you could assign inverter replacement costs in years seven, 17, and 27. After running simulations, you will see the inverter replacement costs in the project cash flow, and they will be accounted for in the other economic metrics including the levelized cost of energy and net present value.

After running simulations, you will see the inverter replacement costs in the project cash flow, and they will be accounted for in the other economic metrics.

Note. Solar Advisor does not calculate any residual or salvage value remaining in inverters or other system components at the end of the analysis period.

To assign inverter replacement costs to particular years:

1.	In the Fixed Annual Cost category, note that the "Value" label is blue indicating that the single value mode is active for the variable.

2.	Click the button with the "Sched" label to change the mode to schedule and activate the Edit button.

3.	Click Edit.

4.	In the Edit Schedule window, use the horizontal scroll bar to find the first replacement year, and type the replacement cost in current or constant dollars for that year.

To delete a value, select it and press the Delete key on your keyboard.

Note. You must type a value for each year. If you delete a value, Solar Advisor will clear the cell, and you must type a number in the cell or Solar Advisor will consider the schedule to be invalid. Type a zero for years with no inverter replacement cost and no annual costs.

5.	When you have finished editing the schedule, click Accept.

Because you must specify an O&M cost category as either an annual cost or annual schedule, to assign both a recurring annual fixed cost and periodic replacement cost, you must type the recurring cost in each year of the annual schedule, and for years with replacement costs, type the sum of the recurring and replacement costs. Note that dollar values in the annual schedule are in nominal or current dollars. Inflation and escalation rates do not apply to values in annual schedules.