The economic prospect of rooftop photovoltaic (PV) system in the commercial buildings in Bangladesh: a case study

Abstract

The research investigates the financial and environmental implications of rooftop PV installation in a case study of commercial buildings in Bangladesh. With annual horizontal solar radiation of 4.65 kWh/m2/day, Bangladesh has a great potential to avail sustainable solar energy which would have environmental and economic ramifications. To accomplish this, the simulation has been carried out using the RETScreen software. To perform the calculation, the climatic data from NASA for the selected location have been considered. Numerous economic indices encompassing net present value, payback period, internal rate of return and benefit–cost ratio have been taken into consideration as a measure of performance indicator for the enacted project. The determined economic outcome of the case study points out a net present value of $756,896 with 14.2% internal rate of return, 10.1 years simple payback time, 8.1 years equity payback and 1.5 benefit–cost ratio which implies that the project is remarkably appealing. In addition, the sensitivity analysis of the project highlights that the profitability of the investment is protected in most of the cases for ± 30% variation in input parameters. For example, initial and fuel costs of the proposed case may generate a negative net present value beyond 15% variations. However, a positive net present value within the wide sensitivity ranges for fuel costs base case, operation and maintenance costs, fuel cost escalation and discount rate, debt ratio and debt term imply that economic feasibility is still obvious. This may encourage the building owner to incorporate solar PV in commercial buildings in Bangladesh.