Market Simulation Based Sensitivity Analysis as a Means to Inform Design Effort as Applied to Photovoltaic Panels

Abstract

Product design success depends on the engineering performance of the product and also on the reaction of external stakeholders such as customers, retailers, and policymakers. This article illustrates how an earlystage engineering design performance model can be incorporated into a decision framework representing customers, retailers, and policymakers to assess the revenue potential for different technologies. Sensitivity analysis is performed for revenue and other stakeholder decision criteria with respect to the design performance measures. We illustrate our approach for photovoltaic panels in the context of the residential solar electricity generation system market in New South Wales, Australia that experienced a variety of federal and state government incentive programs between 2010 and 2012. The analysis is based on engineering performance modeling, discrete choice demand modeling, and cost modeling all with simplifying assumptions.