Optimal sizing of hybrid wind-photovoltaic plants: A factorial analysis

Abstract

This research attempts to determine the optimal size (in terms of profitability) of a photovoltaic (PV) plant that is going to be added to an existing wind installation. The analysis carried out is based on a real sample of 62 wind facilities located in 25 Spanish provinces in 2021. Given the hourly energy generated throughout the year by the wind facility and its grid capacity, the optimal power of the PV plant in the hybrid facility will be the one that allows maximising the net present value of the investment, i.e., the one that allows to better adjust (in economic terms) the PV production to the characteristics of the wind farm. For our empirical analysis we need data on the day-ahead energy market price, on the grid capacity and hourly production (in the day-ahead energy market) of the 62 wind farms analysed, and on the hourly PV production in the Spanish provinces where those wind farms are located. In average terms, to maximise the Net Present Value (NPV) per € invested, the optimal PV power to be added to an existing wind farm should be 8% of the wind power already installed. The averages of the financial indicators for optimal PV sizing are promising (discount rate of 7%): NPV per € invested is 1.89, NPV is M€ 23.5, discounted payback is 4.85 years, and the internal rate of return index is 25.6%. To conclude our empirical analysis, we estimate a multilevel regression model for the hourly wind production. The regression model shows, among other results, that one more MW of wind power translates into an increase in wind generation of 0.31 MWh. Our findings will help the design of hybrid plants without neglecting the economic aspect.