People select PV systems for a variety of reasons. Some common reasons for selecting a PV system include:
PV systems are not cost-effective for all applications. The following discussion gives some general guidelines to consider when deciding whether a PV system is appropriate for your situation.
First, if your site is already connected to a utility grid, or within one-quarter mile of the grid, a PV system will probably not be cost-effective. Each utility company spreads the cost of its power plants and fuel costs among all its customers. Most utilities can provide electricity to consumers for about 6 cents to 14 cents per kilowatt-hour. When you install a PV system, you are essentially installing your own mini-utility system. You pay all the costs of generating the electricity you consume. Although the sun’s energy is free, the PV equipment is not free. The electricity generated by PV systems at current module and balance-of-system prices can cost 20 cents to 40 cents per kilowatt-hour, depending on the installation cost and intensity and duration of the sunlight at the site.
Second, small PV systems are not practical for powering space-heating systems, water heaters, air conditioners, electric stoves, or electric clothes dryers. These loads require a large amount of energy to operate, which will increase the size and cost of your PV system. Therefore, select the most energy-efficient loads available. For example, if your PV system will power lights, look for the most energy-efficient light bulbs. If your system will pump water for toilets and showers, look for the most water-conserving fixtures.