Photovoltaic System Applied in A Medium-Sized Indu

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Brazilian Journal of Development
Photovoltaic system applied in a medium-sized industry in Brazil: economic

analysis
Sistema fotovoltaico aplicado a uma indústria de médio porte no Brasil:

análise econômica
DOI:10.34117/bjdv6n11-058
Recebimento dos originais: 03/10/2020

Aceitação para publicação: 04/11/2020
Rodrigo Kaufmann Martinuzzi

Graduação em Engenharia Mecânica
Universidade Federal de Santa Maria
Endereço: Av. Roraima, 1000, Cidade Universitária. Santa Maria – RS, 97105-900
E-mail: rodrigokmartinuzzi@gmail.com
Cristiano Roos
Doutor
Universidade Federal de Santa Maria
Endereço: Av. Roraima, 1000, Cidade Universitária. Santa Maria – RS, 97105-900
E-mail: cristiano.roos@ufsm.br
ABSTRACT
The planning about the composition of the national electric energy matrix, determined by the growing
demand and population environmental concern, must be based in a best use of renewable sources, as
the photovoltaic solar. Its possible integration in urban areas and use throughout the year in most
parts of Brazil’s territory make this an attractive alternative of investment. In this context, this work
aims to analyze economically the installation of grid-connected photovoltaic panels in a medium-
sized industry in Porto Alegre. Information and data were measured in the field for its development,
which configures the applied nature of the research, which has modeling and simulation as technical
procedure. Two photovoltaic systems were technically dimensioned, one of 23.76 kWp and another
of 39.6 kWp. Both combined with the variation of the Minimum Acceptable Rate of Return of the
investor and the tariff flag in use, configured the 24 scenarios modeled. For the economic viability
were used the Engineering Economy methods such as NPV, IRR, simple payback and discounted
payback, in addition to the LCOE calculation. As main result, the scenario with the highest economic
attractiveness, corresponding to the 39.6 kWp system, obtained NPV of R$ 334,502.27, IRR of 2.79%
per month, payback period of 40 months, discounted payback period of 50 months and LCOE of
0.1374 R$/kWh. Thus, it was possible to conclude that there is economic viability for the projects
proposed. This is because in 16 scenarios the IRR exceeded the MARR considered for the medium-
sized industry used as a case in this work.
Keywords: Engineering Economics, Photovoltaic system, Investment analysis.
RESUMO
O planejamento acerca da composição da matriz energética elétrica nacional, determinado pelas
crescentes demanda de energia e preocupação ambiental da população, deve ser baseado em um
melhor aproveitamento de fontes renováveis, como a solar fotovoltaica. Sua possível integração ao
meio urbano e aproveitamento durante todo ano na maior parte do Brasil fazem dessa uma atrativa
opção de investimento. Nesse âmbito, este trabalho objetiva analisar economicamente a instalação de
Braz. J. of Develop., Curitiba, v. 6, n. 11 , p.84986-85000, nov. 2020. ISSN 2525-8761

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painéis fotovoltaicos conectados à rede em uma indústria de médio porte em Porto Alegre.
Informações e dados foram mensurados em campo para o seu desenvolvimento, o que configura a
natureza aplicada da pesquisa, que tem como procedimento técnico a modelagem e simulação. Dois
sistemas fotovoltaicos foram dimensionados tecnicamente, um de 23,76 kWp e outro de 39,6 kWp.
Esses, combinados com as variações da Taxa Mínima de Atratividade do investidor e da bandeira
tarifária vigente, configuraram um total de 24 cenários modelados. Para a análise da viabilidade
econômica foram utilizados os métodos de Engenharia Econômica do VPL, TIR, PBS e PBD, além
do cálculo do LCOE. Como principal resultado, o cenário com maior grau de atratividade econômica,
correspondente ao sistema de 39,6 kWp, apresenta VPL de R$ 334.502,27, TIR de 2,79% ao mês,
PBS de 40 meses, PBD de 50 meses e LCOE de 0,1374 R$/kWh. Assim, pôde-se concluir que há
viabilidade econômica dos projetos de geração de energia elétrica propostos. Isso porque em 16
cenários a TIR superou a TMA considerada para a indústria de médio porte utilizada como caso neste
trabalho.
Palavras chave: Engenharia Econômica, Sistema fotovoltaico, Análise de investimento.
1 INTRODUCTION
The use of renewable energy resources shows a growing trend in the current world, a fact that
is due not only to environmental concerns, but also to an increase in the energy demand as a result of
the economic recovery in developing countries (PEREIRA, 2007). In Brazil it is no different, and
thus an increment for the electricity production is assumed, a situation that highlights issues about
organization for the maintenance of its supply, and consequently for the expansion and diversification
of the national energy matrix. To ensure that such diversification indicates a perspective of greater
solidity and economic reliability, the decisions on this subject, according to the Energy Research
Office (2016), must be taken well in advance, which increases the challenge of energy planning.
In fact, a significant portion of the national production depends on hydroelectric power, which
is a questionable source about its sustainability and that, according to the National Electric Energy
Agency (ANEEL) (2019), corresponds to 60.85% of the brazilian electricity production. In this
scenario, the solar photovoltaic source represents a promising alternative due either to the capacity to
generate electricity in an elegant way or to a largely integration with the urban environment (DAVI,
2016). These characteristics together with the Brazilian potential for exploration throughout the year,
according to Pereira (2007) because the country is mostly located in the Intertropical Convergence
Zone, makes this solution an attractive application for companies and other investors in general.
It is notable the need for a greater number of applied studies in order to enhance the use of
photovoltaic systems, based on the dissemination of information and stimulation of the market. The
importance of the academic environment for this theme is thanks to its introduction into national
scenario has been constituted in pilot projects, which are developed mainly in universities and
research centres over the last decades. (FERREIRA, 2018).

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This work is also justified as one opportunity to provide an additional case to contribute towards
the practical development of this area and, consequently, to aid the popularization of the photovoltaic
generation model. It is particularly expected to provide future utility for small installations, such as
in industries that wish to evaluate this renewable source of energy. Thus, the objective of this work
is to analyze economically the installation of grid-connected photovoltaic panels in a medium-sized
industry in the city of Porto Alegre, Brazil.
2 THEORETICAL BASIS
2.1 BRAZILIAN SCENARIO FOR PV GENERATION
The use of solar photovoltaic power generation is growing in Brazil, but according to ANEEL
(2019) it still represents only 1.21% of the National Interconnected System production. A greater
economic viability for photovoltaic systems is expected, when assuming both a tariff maintenance
over time and a lowest cost of products, considering parameters of initial investment, capacity factors
and operational and maintenance costs (ENERGY RESEARCH OFFICE, 2016). But despite the
considerable potential for photovoltaic solar energy generation in its territory, even higher than in
countries that already use largely this source, Brazil still has a lack of incentives to enable projects in
this direction (BIRTH, 2017). Related to this, according to Silva (2015), the initial cost of the system
represents the main obstacle, especially for small installations. It is worth to mention that, by the same
author, the availability of other clean energy sources, which nowadays are economically more
attractive than the solar source in the country, delays the application of policies like those found in
other countries. However, public policies have been created by the National Government to
encourage the growth of this technology.
The Distributed Generation Development Program (ProGD) allows, with the creation and
extension of credit lines and financing projects, the installation of distributed generation systems
(VALE et al., 2017). The program intends to stimulate the energy generation by consumers
themselves with the exploitation of renewable sources, especially the solar photovoltaic (MINISTRY
OF MINES AND ENERGY, 2015). As mentioned, the initial investment of these projects represents
a crucial obstacle, and thus the ProGD also provides incentives to manufacturers through professional
training and equipment for distributed generation systems (MINISTRY OF MINES AND ENERGY,
2015). Furthermore, in the case of imported products for photovoltaic applications, the tax rate is
reduced from 14% to 2% and, extending it to the fiscal field, the program also determines the
application of the taxes ICMS and PIS / COFINS to the final energy consumption, with the portion
generated by the consumer already discounted (MINISTRY OF MINES AND ENERGY, 2015). The
dependence of the domestic market on imported equipment is a fact that increases the installation

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cost of photovoltaic systems not only by the taxes, but also by the devaluation of the national
currency.
2.2 APPLIED STUDIES ON PV GENERATION

The wide range of power production associated with photovoltaic systems, possible by its
modular construction, allows a multiple possibilities of applications to it (BRAGA, 2008).
Accordingly, it is important to define the necessary parameters to size and to analyze the technical
and economic viability of these projects, since even if it is considered a high cost model for electricity
production, in some cases it still represents the most suitable method for such purpose. In parallel
with this, according to Braga (2008), companies and the civil society as a whole tend to adopt
environmental policies and postures of greater responsibility and sustainability over time. In this
context, it is interesting to investigate the methodologies that have been used to verify the economic
viability in related works.
Using the Hybrid Optimization of Multiple Energy Resources (HOMER) software, Ngan and
Tan (2011) analyzed economically the viability of hybrid photovoltaic systems installed in a southern
Malaysian city. In this case, the input data consisted in the annual interest rate, initial cost of
installation and project lifetime, besides including the Levelized Cost of Energy for more complete
analysis. With a similar work, but analyzing purely PV systems for households in Ireland, Li, Boyle
and Reynolds (2011), defined the methodology in three steps: generation of the hourly household
electrical load, determination of the power output from a domestic solar PV system and calculation
of Net Present Value (NPV), Internal Rate of Return (IRR) and discounted payback period.
NPV and IRR were also calculated by Lee et al. (2016) in a study to verify the economic
viability to expansion of photovoltaic systems at the University of New Hampshire. Mondal and Islam
(2010) determined the values of IRR, NPV, LCOE and payback period in a grid-connected solar PV
system in Bangladesh, through the costs of investment, operation and maintenance, life cycle of the
panels and inverters, as well as the government's price offer for electricity. Also for the same model,
but in the North of Nigeria, Adaramola (2014) verified, through LCOE and NPV methods, a
possibility of making this generation model viable, once it still depends on the high initial cost that
must be compensated by incentive policies. From these applied studies, it is possible to establish
which are the fundamental parameters to analyze economically the installation of PV systems applied
to the reality of this work.

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2.3 ENGINEERING ECONOMICS
Engineering Economics is, according to Quiza (2011), the study that aims at the financial
evaluation of an investment in order to determine a choice by means of quantitative metrics. As
reported by Nakano (1967), the purpose of Economic Engineering can be summarized as the
comparative study, through a quantitative evaluation, of the profitability of alternatives. The basis for
the evaluation methods is the financial mathematics, which in turn reflects the equivalence relations
of capital, with the focus on the binomial time and money (AVILA, 2013). Thus, the engineering
economy techniques used in this work will be presented below.
The Minimum Acceptable Rate of Return (MARR) is defined as the lowest required
profitability for a project's remuneration (AVILA, 2013). Hence, to consider a project economically
viable, its rate of return must reach or exceed the MARR (BLANK; TARQUIN, 2008). The transfer
of all expected variations in the cash flow to the present time, at a rate equal to the MARR, consists
of the NPV (TORRES, 2004). To achieve the verification by this method, according to Torres (2004),
the result obtained as investor’s interest must be positive or, at least, null. Through this method, the
higher the value the more economically interesting a project becomes. To determine the return on
invested capital in percentage terms the IRR method is used, which represents the exact percentage
of the project's income by period (TORRES, 2004). It is proposed to calculate the rate that brings to
zero the present value calculated for the cash flow, being considered profitable the projects in which
the IRR exceed the MARR (ARDIVEL, 2015).
The required time to obtain return on an investment can also be used as a criterion for the
economic analysis. In this case, there is the payback period method, which is defined as the analysis
of the necessary period of time for the project proposal to reach financial equilibrium - in other words,
to generate enough profit to result in zero the investment amount (QUIZA, 2011). The main
consideration about this method is, according to Assaf Neto and Lima (2009), the disregard for the
effect of time on capital, which indicates that the calculated result is an approximate prediction of the
reality. This is justified due to the time that the project takes to recover an investment representing
an immobilization of capital, that the longer it is the higher is the risk associated with the project.
(AVILA, 2013). In the discounted payback period method, the value of the money applied to the time
is considered, adjusting the future cash flow in accordance with the cost of capital (PRATES, 2016).
Finally, used also to compare different electric power generation technologies, there is the
Levelized Cost of Energy (LCOE), which indicates the per megawatt-hour cost of an installation
project, including the construction and operation investments over an assumed financial life (U. S.
ENERGY INFORMATION ADMINISTRATION, 2018). The LCOE also represents the minimum
cost at which the electricity must be sold in order to reach the financial equilibrium during the

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project's useful life (LAI; MCCULLOCH, 2016). This method, based on what Ueckerdt et al. (2013)
presents, also leads to a greater integration among the renewable energy sources.
3 METHODS
The classification of a research is equally important as the description of its methodological
procedures, and it is possible from the determination of criteria. Following the definitions of
Prodanov and Freitas (2013), this research can be classified according to: the technique used:
quantitative, because it translates information into number to analyze them; the intended use: applied,
because it aims to provide knowledge for a practical application in order to solve a specific problem;
the purpose: descriptive, because it intends to describe the characteristics of a phenomenon and
establish relationship among its variables; and as proposed by Miguel (2012), to the technical
procedures: modeling and simulation, because it involves the use of computational and mathematical
methods to describe and simulate the operation of a system.
As previously shown, from the approach of other works to similar problems, the following
parameters were defined to calculate the economic viability of this research: PV systems acquisition,
maintenance and operation costs, depreciation of equipment, minimum acceptable rate of return,
monetary correction and electricity costs. The acquisition cost of the solar photovoltaic panels, as
well as the other necessary equipment for the system assembly, were obtained from quotes made by
a company of the segment from the city of Santa Maria, Rio Grande do Sul. The useful life of the
equipment and their average costs for maintenance and operation were also determined by the same
company. Based on the useful life of each equipment, their depreciations were calculated by the
straight line method, which attributes an equal rate of depreciation for each period (FINANCIAL
DICTIONARY, 2018).
The MARR was informed by the company used as a scenario for this study, in line with a
generic rate defined for any investment made by them. To determine the inflation applied to the
period, the average annual rates of the last 10 years were considered, based on data from the Citizen's
Calculator (CENTRAL BANK OF BRAZIL, 2018), with the value corrected by the Broad Consumer
Price Index (IPCA), calculated by the Brazilian Institute of Geography and Statistics (IBGE). The
electricity tariff, which indicates the cost paid by the scenario company, was obtained through the
electricity bills provided by them. Such documents were also used to quantify the necessary potential
of the proposed generation systems.
With the purpose of developing a broader analysis, in which more than one investment option
is considered, different conditions were used to model a total of 24 scenarios. This number was
reached by a combination of two electric power generation projects, three variations of MARR and

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the relation of the four tariff flags, a factor used in Brazil to indicate the production cost of electric
energy and that is reflected in the final electricity tariff. Once the necessary information was
determined, the engineering economy techniques were applied to analyze the viability of the
investment alternatives. The following methods were used: NPV, IRR, payback period, discounted
payback period and LCOE, implemented in Microsoft Excel. Finally, the data were organized and
discussed with regard to their practical results.
4 RESULTS
4.1 DATA COLLECTION AND SCENARIOS
In order to determine the electric energy consumption in the company's building, the electricity
bills were analyzed, which later were also used to size the appropriate commercial PV system model.
These documents, issued by the State Electricity Distribution Company (CEEE-D), contain specified
the monthly electric energy consumption. In the period analyzed, from August 2017 to July 2018, the
minimum daily consumption registered was 81.25 kWh, in August 2017, while the maximum was
134.57 kWh, in February 2018. Throughout the period investigated, the average daily consumption
was 109.12 kWh, being this value the basis to size technically the system.
The sizing of the proposed solutions was developed together with a company from Santa Maria,
that is responsible to instalate the systems. A considerable variation in the monthly consumption of
the company was observed, indicating an average of 2,326 kWh per month. The first project intends
to supply the minimum demand, presented mainly in the winter months, that indicates approximately
75% of the average monthly consumption throughout the year. The second project aims to meet
approximately 125% of the monthly average demand, since it has to guarantee the supply in the
summer months, when this value is virtually reached, or even being considered possible expansions
in the company's installation. Both systems, with their technical details, are presented in Table 1.
Table 1 – Photovoltaic projects proposed

Average
Number of Rated power monthly
Projects Total cost (R$)
panels (units) (kWp) consumption
(kWh)
Proposal 1 72 23.76 2,592 92,664.00
Proposal 2 120 12.3 4,320 124,640.00
To assemble the whole system, it is recommended a 25 kW inverter for the one with the lowest
capacity and a 30 kW inverter for the one with the highest capacity. Furthermore, 4 Surge Protection
Devices (SPDs) must be used in each one of the systems. With this information it was possible to
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estimate the maintenance costs for each one of them, which represents an important parameter for
keeping the efficiency of photovoltaic systems. The maintenance needed to the systems are the
cleaning of panels, which has the cost proportional to the number of installed cells, as well as the
replacement of the SPDs and inverters in line with their useful life.
The SPDs have a unit cost of approximately R$ 200.00 and must be replaced whenever an
electric discharge or an overvoltage reaches the electric grid, being neutralized by such devices. The
estimating frequency of change, which depends on the atmospheric conditions and anomalies in the
electric power grid, was every 5 years, as reported by the company consulted, based on their historical
data of this service provision. According to the same company, the costs of inverters are R$ 24,500.00
for the 25 kW model and R$ 28,000.00 for the 30 kW one. This device, used to alternate the direct
current to alternating current, must be changed every 10 years of use. The maintenance relations of
costs and frequencies for the systems are visible in Table 2.
The amount charged for electricity was also obtained through the bills issued by CEEE-D and
provided by the company in study, in which the taxes are already included. So only the value related
to the tariff flags system was added in order to get the final tariff rate. This factor indicates the
condition of electricity generation in the period and has been in force since 2015. It is represented by
three colors of flag: green, yellow and red, while the red flag is divided in level 1 and level 2. Thereby
is stipulated whether there is or not an increase in the value of electric energy (NATIONAL
ELECTRIC ENERGY AGENCY, 2015). For the green flag, which indicates the most favorable
generation condition, there is no increase in the cost. For the yellow flag, the increase is R$ 0.01 per
kWh of electricity supplied. For the red flag, which represents the most expensive condition for
energy generation, there is an increase of R$ 0.03 for level 1 and of R$ 0.05 for level 2, per kWh.
Table 2 – Maintenance costs and frequencies for the PV systems

Unit cost of maintenance (R$)
Maintenance Frequency (years)
Proposal 1 Proposal 2
Cleaning of panels 0.5 1,400.00 2,333.33
SPD replacement 5 800.00 800.00
Inverter replacement 10 24,500.00 28,000.00
For the first period the value of R$ 0.770051 R$/kWh was used as base, according to the value
obtained in the last month analyzed and then, for the future periods, it was corrected with the
corresponding average annual inflation rate. This value is equal to 6.0529% per year and was
calculated by the compound interest rate formula. The MARR, informed by the company at a generic

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value for any investment, was 2.0% per month. With the aim of increasing the number of situations
analyzed, it was decided to contemplate additionally the MARRs of 1.0% per month and 3.0% per
month. With the definition of all the criteria that compose the scenarios, it was possible to model
them in line with the parameters of each one, as presented in Table 3.
Table 3 – Scenarios and their parameters

Proposal 1 (23.76 kWp) Proposal 2 (39.6 kWp)
Green flag 1 5 9 13 17 21
Yellow flag 2 6 10 14 18 22
Red flag – level I 3 7 11 15 19 23
Red flag – level II 4 8 12 16 20 24
MARR (per month) 1.00% 2.00% 3.00% 1.00% 2.00% 3.00%
4.2 ECONOMIC VIABILITY OF THE SCENARIOS

With an arrangement of the previous data according to the scenarios and organizing them in
form of cash flow, it became possible to apply the appropriate engineering economy techniques. For
the results in this work, the scenarios composed of the yellow and red flag level 1 were suppressed,
since they are naturally intermediate in comparison with the green and red flag level 2 scenarios.
Therefore, the results were divided and disposed in line with the flag in force, in order to reduce the
data shown, and thus to facilitate the visualization and allow a comparison between products of the
same tariff reality.
To calculate the NPV, IRR and LCOE was considered a period of 300 months, defined by the
company consulted as the useful life of the photovoltaic systems. The results of NPV, IRR, payback
period and discounted payback period originated from the scenarios 1, 5, 9, 13, 17 and 21 are
presented in Table 4, with the green flag as the factor in use. This condition configures the less
favorable situation for the installation of photovoltaic systems, because it considers the lowest price
of electric energy tariff to be paid to the concessionaire.
Table 4 – Results related to the green flag

Payback Discounted
MARR (per Scenari IRR (per
Projects NPV (R$) period payback pariod
month) o month)
(months) (months)
23.76 kWp 1.0% 1 173,104.27 2.36% 47 63
2.0% 5 20,838.96 2.36% 47 107
3.0% 9 -23,256.04 2.36% 47 VPL < 0

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39.6 kWp 1.0% 13 313,993.82 2.65% 43 53
2.0% 17 56,067.68 2.65% 43 80
3.0% 21 -18,470.66 2.65% 43 VPL < 0
As observed in Table 4, based on the positive NPV results, the scenarios 1, 5, 13 and 17 are
considered economically viable and only the scenarios 9 and 21 are non-viable. This is confirmed by
the calculation of the discounted payback period, in which the non-viable alternatives do not present
a return period within the 300 months of analysis. The viable scenarios indicate different periods of
payback, ranging between reasonable terms, such as 53 months (4 years and 5 months) in scenario
13, or even longer, as 107 months (8 years and 11 months) in scenario 5. It is also visible that for a
shallow study, in which the payback period could be considered sufficient, all the projects would be
viable, a fact that demonstrates the importance of bringing the cash flow values to the present period
based on the MARR of the company. The MARR, by the way, also proved to be a determining factor
that when adopted its highest value, of 3.0% per month, influenced negatively for the economic
viability of the projects.
The table 5 presents the results of NPV, IRR, payback period and discounted payback period
methods for the scenarios 4, 8, 12, 16, 20 and 24. An addition of R$ 0.05 per kWh consumed is
considered in the tariff, according to the red flag level 2. As can be predicted for this case, the values
obtained from the methods are the most favorable to the economic viability of the investment projects,
since it represents the highest increase in the energy tariff. Even if they constitute the most
advantageous scenarios, their analysis is important due to the tariff reality that has been paid by the
company, in which 7 of the 12 provided bills pointed to the red flag level 2 as additional cost.
Table 5 – Results related to the red flag level 2

Discounted
Payback
MARR (per Scenari IRR (per payback
Projects NPV (R$) period
month) o month) period
(months)
(months)
23.76 kWp 1.0% 4 185,409.35 2.47% 45 58
2.0% 8 27,301.92 2.47% 45 93
3.0% 12 - 18,936.65 2.47% 45 VPL < 0
39.6 kWp 1.0% 16 334,502.27 2.79% 40 50
2.0% 20 66,839.28 2.79% 40 71
3.0% 24 - 11,271.68 2.79% 40 VPL < 0

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The NPV result of R$ 334,502.27 for scenario 16 was the highest value found for this indicator
among all the scenarios analyzed, including the intermediate tariff flags. As the only non-viable
scenarios were the 12 and 24, which consider MARR of 3.0% per month, the relevance of this
parameter is highlighted. For the viable scenarios, the values obtained as a discounted payback period
represent short terms of return, especially for the cases with the highest generation capacity. These
values range from 50 months (4 years and 2 months) in the scenario 16, to 71 months (5 years and 11
months) in the scenario 20. Among the scenarios with lowest generation capacity, the maximum
discounted payback period is 93 months (7 years and 9 months), calculated according to the MARR
considered by the company of 2.0% per month.
4.3 LEVELIZED COST OF ENERGY METHOD

The LCOE has its results in the local currency, in this case Brazilian Real, per unit of kilowatt-
hour (kWh). To obtain the value that will be divided by the total production, the installation cost is
multiplied by the Capital Recovery Factor, or CRF, and then the maintenance costs are added. The
values of LCOE showed a greater variation between projects of different generation capacities, since
they have different investment costs too. Among the scenarios with the same capacity, only the CRF
variation, caused by the different MARRs used, made the variation small, close to R$0.001R$/kWh.
Thus, Table 6 presents the LCOEs from the CRF calculated with a MARR of 2.0% per month, a
condition that represents the reality of the company being analyzed.
Table 6 – LCOE results using the MARR of 2.0% per month

Average
Installation Maintenance CRF LCOE
Scenarios monthly cost
cost (R$/kWh)
consumption
5 to 8 2,592 kWh R$92,664.00 R$123,000.00 0.020052738 0.160568630
17 to 20 4,320 kWh R$134,640.00 R$176,665.50 0.020052738 0.138400000
Based on this method, the highest generation capacity project is the most favorable, precisely
due to generating a high production. This information matches the results presented by the other
methods, in which the same project proved to be more advantageous. In this case, the LCOE results
obtained were 0.16056863 R$/kWh for the 2,592 kWh system and 0.1384 R$/kWh for the 4,320 kWh
system.

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4.4 ANALYSIS OF THE RESULTS
For the results presented above, the economic viability for all the proposed scenarios related to
the MARRs of 1.0% and 2.0% per month was verified, considering different tariff flags and electric
power generation capacities. For the scenarios in which the MARR is equal to 3.0% per month, the
engineering economy methods pointed to their non-viability. Among these cases, the closest result to
an economic viability was found with the red flag level 2, with IRR equals 2.79% per month, 0.21%
lower than the scenario's MARR. The IRR analysis is interesting for the individual evaluation of the
scenarios, since it makes possible to quantify in percentage terms the income differences among them,
using the MARR as reference.
It is also possible to justify the advantage of the economic viability for the 39.6 kWp system by
an increase of 45.30% in the installation cost and 43.63% in maintenance cost between the two
projects, compared to an increase of 66.67% in their electric power generation. Or in other words,
from 2,592 kWh to 4,320 kWh. Thus, the utilization of the difference of the generated electricity
amount becomes an important factor to analyze, since it can represent an electricity surplus for the
company.
In any case, the system must be connected to a power meter, so if a surplus is verified in the
electric energy production, it is transferred to the main grid. In accordance to the current legislation,
supported by the Normative Resolution number 687, the surplus electricity production cannot be sold
to the concessionaire, but returned in form of credit, for utilization by the customer within the next
60 months (NATIONAL ELECTRIC ENERGY AGENCY, 2015).
5 CONCLUSION
This work corroborates, therefore, to the global need to seek new alternatives of electricity
generation, given the trend of increasing demand and the need for more sustainable conditions of
generation. These circumstances indicate a reality with a more diversified energy matrix and a better
use of renewable sources, such as the solar photovoltaic.
The scenarios 16, 20 and 24, composed of the highest installed power and related to the red flag
level 2, presented the highest Internal Rate of Return, that is equal to 2.79% per month. The highest
value obtained from the NPV method was associated with the scenario 16 as well and it is equal to
R$ 334,502.27. The scenario 13, the less favorable with the same conditions of MARR and installed
capacity, presented a difference of only R$ 20,508.45, which indicates a good financial attractiveness
for all scenarios with these conditions. For the project with the lowest power capacity, the highest
IRR is equal to 2.47% per month, also derived from the red flag level 2 scenarios. While the highest
NPV obtained for this condition is R$ 185,409.35 in scenario 4.

84998
The strategy of building different scenarios helps for future works development once it makes
a broader analysis, possible of application to different realities. However, the main contribution is to
implement PV systems in medium-sized companies in Brazil. For the final decision on the execution
of the projects, the system with the lowest generation capacity can be understood as less attractive,
but it still depends on the negotiation with the supplier company for the remaining demand, when
necessary. The system with the highest power generation presented the highest degree of financial
attractiveness, considering the use of all its production and being interesting, therefore, in the case of
an expansion in the company’s consumption to the whole generated power of the system.
To conclude this work, it is stated that it was successful in achieving the general objective,
analyzing economically the installation of a grid-connected photovoltaic power system in a medium-
sized industry. From technical information based on the reality of electric energy consumption,
investment costs and average generation, two alternatives of photovoltaic systems were dimensioned
and for the MARR condition adopted by the company in study, which is equal to 2.0% per month,
were proved viable in all the scenarios analyzed.
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84986

Brazilian Journal of Development

Photovoltaic system applied in a medium-sized industry in Brazil: economic

Sistema fotovoltaico aplicado a uma indústria de médio porte no Brasil:

Recebimento dos originais: 03/10/2020

Rodrigo Kaufmann Martinuzzi

Keywords: Engineering Economics, Photovoltaic system, Investment analysis.

Braz. J. of Develop., Curitiba, v. 6, n. 11 , p.84986-85000, nov. 2020. ISSN 2525-8761

Palavras chave: Engenharia Econômica, Sistema fotovoltaico, Análise de investimento.

Braz. J. of Develop., Curitiba, v. 6, n. 11 , p.84986-85000, nov. 2020. ISSN 2525-8761

Braz. J. of Develop., Curitiba, v. 6, n. 11 , p.84986-85000, nov. 2020. ISSN 2525-8761

2.2 APPLIED STUDIES ON PV GENERATION

Braz. J. of Develop., Curitiba, v. 6, n. 11 , p.84986-85000, nov. 2020. ISSN 2525-8761

Braz. J. of Develop., Curitiba, v. 6, n. 11 , p.84986-85000, nov. 2020. ISSN 2525-8761

Braz. J. of Develop., Curitiba, v. 6, n. 11 , p.84986-85000, nov. 2020. ISSN 2525-8761

Table 1 – Photovoltaic projects proposed

Proposal 1 72 23.76 2,592 92,664.00

Proposal 2 120 12.3 4,320 124,640.00

Table 2 – Maintenance costs and frequencies for the PV systems

Cleaning of panels 0.5 1,400.00 2,333.33

SPD replacement 5 800.00 800.00

Inverter replacement 10 24,500.00 28,000.00

Braz. J. of Develop., Curitiba, v. 6, n. 11 , p.84986-85000, nov. 2020. ISSN 2525-8761

Table 3 – Scenarios and their parameters

Red flag – level I 3 7 11 15 19 23

Red flag – level II 4 8 12 16 20 24

MARR (per month) 1.00% 2.00% 3.00% 1.00% 2.00% 3.00%

4.2 ECONOMIC VIABILITY OF THE SCENARIOS

Table 4 – Results related to the green flag

23.76 kWp 1.0% 1 173,104.27 2.36% 47 63

2.0% 5 20,838.96 2.36% 47 107

3.0% 9 -23,256.04 2.36% 47 VPL < 0

Braz. J. of Develop., Curitiba, v. 6, n. 11 , p.84986-85000, nov. 2020. ISSN 2525-8761

2.0% 17 56,067.68 2.65% 43 80

3.0% 21 -18,470.66 2.65% 43 VPL < 0

Table 5 – Results related to the red flag level 2

23.76 kWp 1.0% 4 185,409.35 2.47% 45 58

2.0% 8 27,301.92 2.47% 45 93

3.0% 12 - 18,936.65 2.47% 45 VPL < 0

39.6 kWp 1.0% 16 334,502.27 2.79% 40 50

2.0% 20 66,839.28 2.79% 40 71

3.0% 24 - 11,271.68 2.79% 40 VPL < 0

Braz. J. of Develop., Curitiba, v. 6, n. 11 , p.84986-85000, nov. 2020. ISSN 2525-8761

4.3 LEVELIZED COST OF ENERGY METHOD

Table 6 – LCOE results using the MARR of 2.0% per month

5 to 8 2,592 kWh R$92,664.00 R$123,000.00 0.020052738 0.160568630

17 to 20 4,320 kWh R$134,640.00 R$176,665.50 0.020052738 0.138400000

Braz. J. of Develop., Curitiba, v. 6, n. 11 , p.84986-85000, nov. 2020. ISSN 2525-8761

Braz. J. of Develop., Curitiba, v. 6, n. 11 , p.84986-85000, nov. 2020. ISSN 2525-8761

ADARAMOLA, M. S. Viability of grid-connected solar PV energy system in Jos, Nigeria. Electrical

ARDIVEL, B. V. S.; Diretrizes para a análise de viabilidade econômico-financeira de

AVILA, A. V.; Matemática financeira e engenharia econômica. Programa de Educação Tutorial

BRAGA, R. P. Energia solar fotovoltaica: fundamentos e aplicações. 64 f. Projeto (Graduação) –

CENTRAL BANK OF BRAZIL. Calculadora do Cidadão. 2018. Disponível em:

Braz. J. of Develop., Curitiba, v. 6, n. 11 , p.84986-85000, nov. 2020. ISSN 2525-8761

FINANCIAL DICTIONARY. O que é depreciação na contabilidade?. 2018. Disponível em:

LEE, J. et al. Economic feasibility of campus-wide photovoltaic systems in New England.

MIGUEL, P. (Org.). Metodologia de pesquisa em engenharia de produção e gestão de operações.

MONDAL, A. H.; ISLAM, S. Potential and viability of grid-connected solar PV system in

NAKANO, Y. Engenharia Econômica e Desenvolvimento. Revista de Administração de

NATIONAL ELECTRIC ENERGY AGENCY. Resolução Normativa Nº 687. Brasília, 2015

Braz. J. of Develop., Curitiba, v. 6, n. 11 , p.84986-85000, nov. 2020. ISSN 2525-8761

PRODANOV, C.C.; FREITAS, E.C.; Metodologia do Trabalho Científico: métodos e técnicas da