Domestic Solar Power and Diesel Generator Electricity Cost Evaluation

Domestic Solar Power generation using BIPV ( Building Integrated Photo Voltaic) Products, e.g. Roof top Solar systems etc. have slowly become mainstream products, with falling costs of PV panels and ever increasing costs of fossil fuels.

Energy is an essential requirement for survival. May it be heat, light or any form of mechanics- everything needs energy. The remote villages in India are still deprived of electrical supply from the conventional grid source. The Diesel Generator (DG) sets are being used for power but its operation is limited due to high cost of fuel and high maintenance.

In this article, we shall compare the cost of Domestic Solar Power Generation with DG power ( using Diesel). Calculations are in INR ( Rupees). For the purpose of calculations, we shall base our projections on a small household, where the requirement of electricity is about 25 units per day (25kwH ), with an average  of 1kwh ( 1 units) per hour, spaced over 24 hours ( the length of the day).

DG OPTION with an inverter and 2 batteries (back up) For this application, we would need a 5 kw gen set, costing about 1,00,000/- consuming about 1.25 litres of diesel per hour, besides the regular maintenance and replacement after the life cycle of about 5 to 6 years. Battery backup and an inverter has been provisioned so that the gen set is used for about 10 hours and the inverter for about 8 to 10 hours.

Fixed Costs- 1,55,000/- ( see below)

Considering that a bank loan is availed and re-payment scheduled over 5 years, the principal per annum works out to 30000 and interest payments- 15000, 12000, 9000, 6000, 3000

Re-Occurring Costs- Gen-set after 6 years ( life cycle), batteries after 3 years. – i.e. 1,20,000/6 = 20,000 per annum for gen-set and 30,000/3= 10,000 per annum for batteries, totaling 20,000 + 10,000 = 30,000. From this, let us deduct 20%  as scrap value of gen-set and batteries ( 20% of 30000 = 6000). So Net re-occurring expenditure is= 30000-6000= 24000 per annum.

Running Costs- Diesel @ 1.25 litres per hour x 10 hrs per day x 365= 4562.5 litres per annum @ 56/litre (current prices- likely to go up in future)=2,55,500. Maintenance of gen-set/engine service etc- @ 1000 per month ( an approximation)= 12000 per annum. So the total running cost per annum is about 267500/- ( Rounded 2,70,000).

So, from above, the total cost for 20 hour/day electrification is about 3,00,000 per annum.

However, running a gen-set for 10 hours per day is cost prohibitive, so, for purpose of our projections, let us extrapolate to costing on running the gen-set for 5 hours per day- in summers ( 8 months)  and 2 hours ( in winters- 4 months). This is like running an average of 4 hours daily over the whole year. The RUNNING COST, under this scenario would be 108000/-. Thus, running cost +re-occurring cost on a 4 hour gen-set shift = 108000+ 24000= 132000

Domestic Solar Power OPTION with stand-alone PCU and battery back up

Fixed Costs- 6,25,000 approximately ( varies slightly, with site parameters)

Considering that a bank loan is availed and re-payment scheduled over 5 years, the principal per annum works out to 130000 and interest payments- 65000, 52000, 39000, 26000, 13000.

Re-Occurring Costs- 1%  loss in efficiency of panels, i.e. 6250/- and 6 batteries after 6 years= 90000/6= 15000 , less scrap value (20%=3000)= 12000. TOTAL= 18000 (rounded)


From above, we notice the following salient features



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