Policy assessment in photovoltaic development using system dynamics: Case study of power generation in Iran

Abstract

The development of renewable energies is inevitable due to the outstanding share of energy section in greenhouse gas production. This research presents a system dynamics model for a photovoltaic (PV) ecosystem. The model considers the inherent and economic properties of supportive policies and reflects their effects on investment evaluation. The development of PV power generation can be modelled as S-shape growth if the adjustment and elimination of supportive policies occur on time. Delay in policy change, energy market fluctuations, and the interaction of influential factors may cause overshoot or oscillation in the ecosystem. After validation and case study, measures are proposed for comprehensive understanding of different states. Compatibility of supportive policies with state of the PV ecosystem facilitates the development path. The results show that the deployment of PV in Iran prevents 101 million tons of CO2 production in 20 years. However, the current state of power purchase agreement (PPA) policy does not guarantee the economic feasibility of investment in PV power generation, which explains Iran's slow development and expansion in this field. The model is beneficial for both developed and developing countries, especially for those in the Middle East with massive fossil fuel resources, to modify supportive policies based on the state of their PV ecosystem.