The Economic Feasibility of Utilizing Small-Scale Solar PV Systems in the Residential Sector Based on Saudi Regulations

Abstract

The government of Saudi Arabia recently adopted regulations for small-scale solar PV systems. These regulations allow consumers in the residential, commercial, industrial, and agricultural sectors to install grid-connected PV systems on their properties and inject the extra generated energy into the utility grid or meet their individual energy needs. The system regulates and governs the relationship between the consumer and the authority of electricity authorities. However, the economic feasibility of installing PV systems has not yet been investigated from the consumer side. In this thesis, the researcher used RETscreen software to simulate different cases of PV installations in five cities across Saudi Arabia (Buraydah, Tabuk, Jeddah, Najran, and Dammam). The study took into account the meteorological properties, energy demand of houses in each city considering the current prices of equipment and the cost of maintenance in the Saudi market to determine the feasibility of installing gridconnected PV systems in homes according to the new regulations and energy exchange tariff in Saudi Arabia. The results showed the feasibility of installing the grid-connected PV systems in houses if the PV system designed to match the annual energy demand, with payback time around 10 years and the LCOE about 0.095 SAR/kWh. The study also showed the increasing the capacity of the PV system more than the annual demand will be infeasible economically as the size of the PV system increased more than the actual energy demand.