Assessing the Economic Benefits of Investing in Residential Photovoltaics With Energy Storage Systems in a ‘Greening’ Economy: a Case Study of Norway

Abstract

This study aims to determine under what conditions it would be economically beneficial for a “typical” Norwegian household to invest in a photovoltaic (PV) system in combination with energy storage. In recent years, the Norwegian government has committed to reduce the country’s greenhouse gas (GHG) emissions by 40% against 1990 levels and has developed a strategy to comply with international emissions reduction obligations. Reducing energy consumption in the domestic sector is part of their strategy to achieve this target, with 2% of national GHG emission and 31% of national energy consumption linked to the domestic sector. This study uses data from the current building stock and climate datasets to build a dynamic model using TRNSYS. The simulated energy demands for the “typical” houses and the potential for generating electricity using PV, with and without storage, in the different locations forms the foundation of a cost-benefit analysis. Using payback period as an indicator for economic benefit, a current investment in a PV system supported by a storage solution is unlikely to be beneficial within the lifetime of the PV modules. A PV-only system on the other hand will have a payback period of 12-17 years and will be of economic benefit in all locations considered in this study. Using experiences from other countries, storage systems are likely to be more beneficial in a political-financial environment with lower Feed-in Tariffs and without the initial investment support for PV-only systems.