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PowerPoint ® Presentation Photovoltaic Systems Return on Investment Analysis Incentives Rebates Grants Cost Analysis Life-Cycle Costs Value of Money Annualized Costs Financial Payback Incentive Adjustments Arizona Solar Power Society Incentives Rebates Grants Cost Analysis Life-Cycle Costs Value of Money Annualized Costs Financial Payback Incentive Adjustments Arizona Solar Power Society

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Chapter 15 Economic Analysis Several types of incentives are available for PV and other renewable-energy systems.

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Chapter 15 Economic Analysis Tax incentives reduce the amount of tax that must be paid, whether they are tax exemptions or tax credits.

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Chapter 15 Economic Analysis Renewable energy certificates (RECs) allow a utility or its customers to claim renewable energy while providing a financial incentive for renewable-energy producers.

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Chapter 15 Economic Analysis A life-cycle cost analysis compares the life-cycle costs of various electricity- supply options.

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Chapter 15 Economic Analysis Each system option must meet the same requirements, including the length of time used to calculate life-cycle cost.

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Chapter 15 Economic Analysis The various types of life-cycle costs occur at different points in the life cycle of a power-generating system.

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Chapter 15 Economic Analysis A certain amount of present money is equal to a greater face-value amount of future money. The difference in face value depends on the difference in time.

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Chapter 15 Economic Analysis The present value of future money falls more quickly with higher discount rates.

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Chapter 15 Economic Analysis The single present value factor is used to quickly calculate the present value of a single future value.

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Chapter 15 Economic Analysis Related costs that occur every year are calculated and added together for each year to determine the total present value.

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Chapter 15 Economic Analysis The recurring present value factor is used to quickly calculate the present value of a future value recurring for a number of years.

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Chapter 15 Economic Analysis A life-cycle cost analysis totals the present values of all the life-cycle costs over the length of the analysis period.

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Chapter 15 Economic Analysis The life-cycle cost analysis of a utility connection includes the initial connection costs and annual energy costs.

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Chapter 15 Economic Analysis The life-cycle cost analysis of an engine- generator system includes each type of cost.

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Chapter 15 Economic Analysis The most significant costs in the life cycle of a PV system are the initial costs.

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Chapter 15 Economic Analysis Annualizing costs spreads costs evenly over the operating period, but results in the same total life-cycle cost for a system.

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Chapter 15 Economic Analysis The payback point occurs when the cumulative avoided cost of one system matches the total life-cycle cost of another system.

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Chapter 15 Economic Analysis The payback point can be determined by comparing the actual life- cycle costs of the various system options.

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Chapter 15 Economic Analysis The annualized-cost method of determining the payback period is relatively simple, though it may be less accurate than the actual-cost method.

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Chapter 15 Economic Analysis Incentives affect the total life-cycle cost differently, depending on how and when they are applied.

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