Economic and Environmental Evaluation of Residential Fixed Solar Photovoltaic Systems in the United States

Abstract

While the majority of electricity generated in the United States comes from fossil fuels such as coal and natural gas, a comparatively small amount comes from renewable sources such as solar and hydropower. As global environmental issues become a greater concern, more generation may need to come from renewable sources. One often-mentioned alternative is residential solar photovoltaic (PV) systems, which could be an especially attractive source of energy in the southwestern United States, where high amounts of solar radiation are available. In this paper, we compare the life-cycle costs of current solar photovoltaic technology in Arizona versus New York to highlight the relevant issues related to the economic and environmental renewable energy decision-making process. We find that solar PV systems alone are currently inferior to grid electricity across a wide range of scenarios, including prospective technology improvements. Net metering with PV systems, where customers sell solar electricity to the grid and buy back their demand, may be competitive given real-time electricity pricing. Using PV systems in remote systems looks to be a viable alternative.