European Commission > Energy > Intelligent Energy Europe

Definition of grid-parity for photovoltaics and development of measures to accompany PV applications to the grid parity and beyond (PV PARITY)

Project brief
Key action: Electricity production
Status: Closed
Coordinator: Ms Ingrid Weiss
WIRTSCHAFT UND INFRASTRUKTUR GMBH & CO PLANUNGS KG, Germany
E-mail: ingrid.weiss@wip-munich.de
Tel: 0049 89 72012741
Partners: Vienna University of Technology (Technische Universitaet Wien) (TU Wien), Austria
European Photovoltaic Industry Association (EPIA), Belgium
EDF Energies Nouvelles (EDF EN), France
Forschungsstelle Umweltenergierecht e.V. (FUER), Germany
Technical University of Crete, Greece
ENEL GREEN POWER (EGP), Italy
Energy Service System Operator (Gestore dei Servizi Energetici) (GSE), Italy
STICHTING ENERGIEONDERZOEK CENTRUM NEDERLAND (ECN), Netherlands
Instituto para la Diversificacion y Ahorro de la Energia (IDAE), Spain
IC CONSULTANTS LTD (ICON), United Kingdom
Website: http://www.pvparity.eu/
Benefits: This project aims at contributing to the achievement of increased PV penetration in EU electricity markets and PV grid parity at a lowest possible price for the community.It will define grid parity and the measures to be taken to accompany PV application to the grid parity and beyond.
Keywords: Grid parity, photovoltaics, electricity markets.
Duration: 01/06/2011 - 30/11/2013
Budget: EUR 1 894 136 (EU contribution: 75%)
Contract number: IEE/10/307

Summary

This project aims at defining grid parity, i.e. achieving a stage of development of the PV technology, at which it is competitive with conventional electricity sources. It also will provide relevant policy makers in the EU member states with a clear understanding of the necessary measures to support solar Photovoltaic technology in achieving grid parity. The project will also develop strategies for supporting the photovoltaic sector after grid parity is reached. As a result, an increased PV penetration in EU electricity markets and grid will be accomplished at a lowest possible price for the community.
The consortium forecasts the cumulative cost of current incentives and present a cost/benefit analysis of the integration of PV systems in the markets and in the grid. Benefits related to externalities, such as the avoided CO2 costs and other environmental benefits such as the energy pay-back times and the cost of avoided fossil fuels imports will also be considered.
Moreover, the project will analyse the inefficiencies and bottlenecks of the current support schemes and it develop proposals for alternative incentives for PV installations. These may include net metering (which already exists in some EU member states), premiums above the electricity prices in case of self-consumption, incentives for storage and for non-South oriented systems, and other new propositions. The new incentives should enable national governments to increase the share of PV in the electricity mix of their countries with the highest benefits and at the lowest price.

Results
  • Commonly acknowledged definition of grid parity, validated by the PV community.
  • Practical roadmaps to grid parity for the target countries, representing the major EU PV markets and/or markets with the highest development potential.
  • Current support schemes will be examined and their implied costs until grid parity will be forecasted.
  • Alternative support schemes recommended to national policy makers.
  • Financial assessment of PV investments until grid parity, with a clear comparison between current and alternative schemes.

Lessons learnt
  • In the residential, PV has reached cost competitiveness in several EU regions in 2012 (e.g.: South Germany, South Italy, Crete) and more European countries will follow in future depending on the market segments. Also the commercial & industry sector reached cost competitiveness in the same time as in the residential sector.
  • Support schemes still needed for other market segments on the longer term. New business models for different stakeholders needed; especially for utilities future support schemes are needed in order to reach the PV competitiveness for PV systems connected to the grid (referred as the wholesale parity).
  • The European grid (HV) needed to minimize costs on balancing and storage. Harmonisation of EU network would be ideal; as concerns off-grid areas, like islands, to fully exploit PV parity regional grids should be developed.
 

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