Don't underestimate photovoltaic buildings! After calculating this, I regret knowing too late!

I. The Rise of Photovoltaic Buildings!

Friends, I wonder if you've noticed that buildings are becoming increasingly "smart"! Older houses and buildings were just "steel and cement boxes" for living and working, at most with some effort put into decoration. But now, many buildings have secretly installed "solar power generation skin," transforming themselves into "green energy experts." This is the currently popular Building-Integrated Photovoltaics (BIPV)!

Speaking of which, our construction industry has always been a "major energy consumer." The "2021 Global Construction Industry Status Report" is like a "gossip expert," directly revealing the data: In 2020, the construction sector consumed 36% of the world's final energy consumption and produced 37% of energy-related carbon dioxide emissions! This number is shocking, like placing a heavy stone on Mother Earth's back.

To "reduce the burden" on the Earth, the construction industry has also begun a vigorous "green revolution." Zero-energy, positive-energy, and zero-emission buildings have become the new trend, and solar energy, as a clean, infinite, and renewable "treasure energy," has naturally become the "main force" of this revolution. Building-Integrated Photovoltaics (BIPV), simply put, perfectly integrates solar power generation components with the "outer garments" of buildings such as roofs, walls, and windows, allowing buildings to not only shelter from wind and rain but also utilize sunlight to generate electricity. It's like giving buildings a "super suit" that can both protect itself and release energy!

However, it's not easy for BIPV to "debut." Although there is already a lot of research introducing BIPV technology, it has encountered many "obstacles" in market promotion. The most troublesome is the high initial investment cost and slow return, which is like investing a large sum of money in the early stages of a business without knowing when the investment will be recovered, causing many people to hesitate. Moreover, previous studies on analyzing the economic benefits of BIPV often ignored its contributions to society and the environment, lacking a comprehensive and scientific evaluation method, making it difficult for people to see the true value of BIPV.

Today, let's follow a very powerful study to uncover the mystery of the economic feasibility of BIPV throughout its life cycle and see if it is a "loss-making product" or a "potential stock"!

 

II. Understanding BIPV: First Learn to "Calculate"!

To know whether BIPV is profitable, we must first learn to "calculate." This study uses a very professional method called Life Cycle Cost Analysis (LCCA). It sounds very advanced, but the principle is simple, like calculating whether we have made a profit or loss at the end of the year. We not only need to calculate how much money we spent at the beginning but also include all income and expenses throughout the year, such as water and electricity bills, money spent on shopping, salary income, etc.

When analyzing BIPV, LCCA considers the costs and benefits of the project from the initial construction to operation, maintenance, and replacement stages. Then, it converts these future costs and benefits into their present values according to a certain ratio, obtaining two important indicators: Net Present Value (NPV) and Discounted Payback Period (DPP). NPV is the net profit that the BIPV system can earn during its entire life cycle, and DPP is how long it takes for BIPV to earn back its initial investment. Through these two indicators, we can clearly know whether the BIPV project is worthwhile and compare which BIPV scheme is more profitable.

 

Many factors need to be considered when calculating. In addition to some basic parameters of the BIPV system itself, such as the initial investment cost, annual operation and maintenance costs, system lifespan, and power generation capacity, there are also many "hidden accounts."

For example, economic factors such as self-use electricity prices and grid-connected electricity prices are crucial. The self-use electricity price is the electricity cost saved by using electricity generated by BIPV, and the grid-connected electricity price is the money earned by selling excess electricity to the grid. There is also the discount rate, which is like our expectation of future returns. If we think that future money is not as valuable as current money, the discount rate will be higher; otherwise, the discount rate will be lower. The electricity price inflation rate cannot be ignored; it reflects how electricity prices change over time, just as prices rise, electricity prices may also change.

In addition, BIPV has some "hidden benefits." It can reduce losses during electricity transmission. The electricity we use usually travels through long transmission lines from power plants to our homes, during which some electricity is wasted, like water leaking during transportation. BIPV generates electricity directly at the point of use, solving the "leakage point" and reducing the cost of constructing and maintaining the power transmission network. There is also the social cost of carbon; every ton of carbon dioxide emitted causes environmental damage, and BIPV can reduce carbon emissions, which is also a kind of "invisible income."

However, the study made some assumptions when calculating. For example, it assumes that the BIPV system completely replaces traditional building materials without considering the differences in their costs; due to the lack of relevant data, it temporarily does not consider the carbon emission costs of BIPV panel manufacturing, transportation, and disposal, and the scrapping and recycling of photovoltaic components. Although these assumptions may cause some minor deviations in the results, they do not affect our overall understanding of the economic benefits of BIPV.

III. Practical Case: The "Transformation" Journey of a Suzhou Office Building

Talking about theory may be a little boring, so let's look at a real case. There is an office building in Suzhou that is like a "big electricity consumer," consuming a large amount of electricity every day. Later, it decided to give itself a "green transformation," installing solar photovoltaic components on the eaves of each floor and the first-floor corridor roof. These components are like the building's "solar power generation armor," which can utilize solar energy for power generation and provide shading, achieving two goals at once.

 

This building has 3720 square meters of photovoltaic panels, with a designed total capacity of 325.19 kW. The system type is grid-connected, meaning that the generated electricity is directly used by the building's electrical equipment, and excess electricity can be sold to the grid. In terms of power generation, the photovoltaic system is like a "volatile friend," fluctuating with seasonal changes. In summer, when the sun is abundant, power generation explodes. In August 2017, power generation reached its peak at 35,000 kWh; in winter, when there is less sunshine, power generation is lower, with only 17,000 kWh in November 2017. However, overall, a total of approximately 314,200 kWh was generated in two years, which is still a pretty good result!

 

Looking at its energy-saving effect, it's simply an "energy-saving champion"! The average annual energy consumption per unit building area is 5.96 kWh/m², and after installing the photovoltaic system, the electricity generated annually accounts for 23% of the building's annual energy consumption. Compared with the national standard for Class A commercial office buildings in summer-hot and winter-cold regions, it can save 197.03 tons of standard coal and reduce carbon dioxide emissions by 491.71 tons annually, and also save 456,900 yuan in electricity costs. These are all real benefits!

 

However, installing this "solar power armor" on a building requires a significant upfront investment. After researching various data, it is assumed that the initial investment for this BIPV system project is 1.52 million yuan. Factors such as system lifespan, inverter replacement costs, and operation and maintenance costs were also considered. The BIPV system is expected to last 30 years, with inverters replaced every 10 years at a cost of 17% of the initial cost, and annual operation and maintenance costs are 1% of the initial cost.

Next is the moment to witness the miracle! Using the traditional net present value calculation method, the discounted payback period for this BIPV project is as long as 12 years. In other words, it takes 12 years to recoup the initial investment of 1.52 million yuan. This time is too long, and many investors might be discouraged.

However, after recalculating using the new method proposed in this study, the results are eye-opening! After considering the contribution of the BIPV system to society and the environment, the discounted payback period is directly shortened to 5 years! Seven years faster! It's like originally having to walk a long road for 12 years, suddenly discovering a "super shortcut", reaching the destination in 5 years. This is such a great deal!

What does this show? It shows that we have been underestimating the value of BIPV! It can not only generate electricity and save energy but also contribute to society and the environment. These contributions are actually "invisible wealth." After including them, the economic feasibility of BIPV is greatly improved; it's simply a "potential stock"!

 

IV. The "Money Scene" and Future of BIPV

Through this case, we can clearly see that Building-Integrated Photovoltaics (BIPV) is definitely a major trend in the future development of buildings. It's like an "all-around player," solving energy and environmental problems while bringing economic benefits.

From an environmental perspective, BIPV can reduce carbon emissions and contribute to achieving carbon neutrality goals, like a little angel "reducing the burden" on Mother Earth; from an economic perspective, although the initial investment is large, as long as its various "hidden benefits" are included, the payback speed is actually much faster than we imagined, and it can continue to generate income afterward, making it a worthwhile investment.

Of course, for BIPV to truly "take off," some issues need to be addressed. For example, the initial investment cost needs to be further reduced to make it more acceptable to more people; relevant policies and market mechanisms also need to be improved to create a better development environment for BIPV. However, with continuous technological advancements and increasing emphasis on green energy, it is believed that in the near future, there will be more and more "power-generating buildings" around us. They will not only meet our living and working needs but also add a touch of green to our planet.

Friends, do you look forward to living or working in such a photovoltaic building? Welcome to leave a message in the comment area and share your thoughts! If you find this article helpful, don't forget to like and share it, so that more people can see the "money scene" of BIPV!