Economic analysis of a photovoltaic system connected to the grid in Recife, Brazil

Brazil has a big potential in solar energy, because of its location and territorial extension. However, this country does not explore this great source of energy, because of the high cost of installation of the photovoltaic (PV) system. This paper brings a design of a grid-interactive PV system with battery backup focusing more on the financial part, as a way to decrease the price to install this type of system. By analyzing a hypothetical load in a house in Recife, two situations were proposed: the use of incentives for financing and capital allowance through tax incentives, and the energy compensation system, net metering. The computational software SAM (System Advisor Model) was used to generate data for economic and financial analysis through methods like NPV (Net Present Value), PAYBACK and LCOE (Levelized Cost of Electricity). The results obtained show that distributed micro-generation through PV system is not economically viable without incentive instruments, such as regulatory policies, fiscal incentives and public financing.