Commercial (100kw) Photovoltaic System Cost Structure : The Cases of Korea, Germany, and China

The trading prices of solar-generated electricity have reached a new record worldwide. However, the average selling price in Korea was realatively high, at 182 won/kWh. This study aims to identify the reasons for the discrepancy between Korean and global prices for photovoltaic power using levelized costs of energy (LCOE) and considering the factors determining photovoltaic costs, such as differences in module prices, balance of plants (BOP), finances, capacity factors, and taxes. Germany and China were selected as major countries of comparison for the purposes of this study. Both countries are similar to Korea in terms of their solar irradiance quantity, but they have lower photovoltaic power prices compared with Korea, allowing for meaningful analysis. The results of the cost analysis identified three areas that can be effectively controlled through government policies—licensing fees, standard facility charges (grid connection costs), and safety management costs. If the costs are lowered to the target values, Korea’s LCOE could be decreased to 134.9 won/kWh, which is 12.2 won/kWh lower than the current LCOE. We expect to increase the cost efficiency of photovoltaic power generation in Korea and allow the government to supply more photovoltaic power at reduced costs.