Abstract
In the most countries, there are a variety of policies and incentives to encourage investors to develop photovoltaic (PV) systems. In this paper, the impact of financial incentives is investigated on the optimal sizing of a grid-connected PV-based power supply system located in Iran. To optimally design the system, the installed PV surface and percentage of the deficit power purchased from the electricity grid are determined to minimise net present cost and keep reliability at the desired level with two incentive strategies: rebating investment cost (RIC) and feed-in tariff (FIT). As an efficient optimiser, the harmony search algorithm is applied to find an optimal solution. In the case study, based on the simulation results, when the RIC incentive strategy is regarded, it is seen that at the current electricity price, it is not beneficial to use the PV technology. If the electricity price increases by around 80%, the installation of a PV system becomes cost-effective. When the FIT incentive strategy is considered, it is not beneficial to use the PV technology unless the electricity price considerably increases.
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