An Economic Analysis of Solar Panels in Educational Facilities in Kashan City

This paper reports the results of an economic analysis of photovoltaic solar panels installed in schools in Kashan City. The electrical output of these panels was compared with electricity bills for a period of 12 months between July 2012 to June 2013. The results indicate that the investment return period for a system of 5 kilowatts capacity is 10~12 years based on real electricity prices. This period increases to 46~50 years if subsidized electricity prices are taken into account. Considering real electricity prices, the rate of return for such investments is calculated to be between 2.6~3.2; but taking into account subsidized electricity prices both the net cash flow and the net present value become negative. This means that although in principle, the use of photovoltaic systems is economically viable, with the current policies of providing heavily subsidized energy, such systems yield no economic benefit in public or private schools. Furthermore, this analysis indicates that allocating more roof area, inasmuch as twice the necessary area for building usage, yields justifiable benefits. This means that the use of solar panels could yield more economic benefits in commercial buildings due to their higher electricity consumption and wider areas as compared to educational facilities.