Generic Distributed Photovoltaic Cost Outlook Methodology: Australian Market Application Example

The generation capacity of renewable energy sources is surging in global markets due to their sustainability and falling costs. This paper analyzes the uptake of photovoltaic (PV) technology adoption, focusing on distributed PV (residential & commercial scales) cost decay trends, given that small-scale PV contribution to global capacity is expected to exceed 10% by 2040 compared to 2% today. Understanding the driving cost reduction factors is thus important for adequate resources management and policy planning, in addition to PV adoption profitability assessment. Generic market-based cost prediction methodology is presented and tested on the Australian market. Cost predictions in this research are based on technology learning-rates (LR), refined by target market conditions and global trends. The Australian example study outcome predicts a cost decline around 40% in distributed PV market by 2040. Results are benchmarked against similar international market forecasts and LR and found to be in good agreement. The proposed methodology can be similarly extended to different global markets.