profitability of the photovoltaic installation vs hydraulic turbine

In these times, with self-consumption launched and an energy transition in the making, the profitability of solar panels has exploded over the years, until investing in photovoltaics becomes one of the most profitable options that can be found today, but what about water utilities and large consumers of water? water that have the possibility of installing other energy sources, such as hydraulics?

In order to answer this question, we will study 2 clearly differentiated cases; on the one hand, when the destination of the energy is self-consumption in the installation itself, and on the other hand, when it is planned to sell the electrical energy produced to the electricity company.

To make a simple but representative study, we considered that we are in the ETAP of a Spanish city where we want to take advantage and install 10 kWp of solar photovoltaic on the roof of the building (the equivalent of the installation of 25 solar panels). photovoltaic) in relation to the installation of a 10 kW hydraulic turbine in the inlet water pipe of the wastewater treatment plant.

In the study, we take into account the annual energy generated by the two technologies, which multiplied by the purchase price of the energy gives us a rough idea of ​​the annual gross savings that we will obtain in the installation.

On the other hand, the estimated costs of the initial investment that would be necessary for the installation of each technology are analyzed, as well as an estimate of the annual maintenance costs.

The objective of the analysis is to determine the payback period as well as the IRR at 10, 20 and 25 years (estimated useful life of the two technologies) and to compare the result between the two options.

The prices of the photovoltaic installation as well as the prices of the hydraulic turbine were provided by the Spanish manufacturer of hydraulic turbines Powertrains.

Grid-connected self-consumption installations

As the energy produced will be self-consumed in the installation itself, we consider an average purchase price of energy of 0.12 € / kWh, which is the price that this company pays for energy in his monthly electricity bill.

With the photovoltaic installation, we obtain the following results;

Whereas with the installation of the hydraulic microturbine, the results are;

If we compare the results after 25 years of useful life;

By observing the information, we can conclude that;

  • The photovoltaic installation generates 20,000 kWh per year, so it produces an annual income of around 2,400 €. The investment is only € 10,500, and an annual maintenance cost is estimated at € 240, so the payback period is 4.77 years with a 25-year IRR of 21%.
  • The hydraulic turbine, on the other hand, generates 83,220 kWh per year, so it produces an annual income of approximately € 9,986.40. The investment is € 27,000, and an annual maintenance cost is estimated at € 299.59, so the payback period is 2.76 years with a 25-year IRR of 37%.
  • If we add the cumulative benefits after 25 years, the solar photovoltaic option amounts to € 51,523.68 while the hydraulic turbine amounts to € 247,857.73.
  • Either of the 2 options is viable, but without a doubt the hydro turbine option far exceeds the photovoltaic option with a payback period of less than 3 years.
  • We have not taken into account the fact that any of the 2 options may also be the subject of substantial subsidies and aid from the Spanish government or the European Community.

Installations for the sale of energy to the electricity company

As the energy produced is going to be sold to the electricity company, we consider an average energy selling price of 0.05 € / kWh, which is the price the customer will receive for selling energy.

With the photovoltaic installation, we obtain the following results;

Whereas with the installation of the hydraulic microturbine, the results are;

If we compare the results after 25 years of useful life;

By observing the information, we can conclude that;

  • The photovoltaic installation generates 20,000 kWh per year, so it produces an annual income of around € 1,000. The investment is only € 10,500, and an annual maintenance cost is estimated at € 240, so the payback period is 13.01 years with a 25-year IRR of 6%.
  • The hydraulic turbine, on the other hand, generates 83,220 kWh per year, so it produces an annual turnover of approximately € 4,161. The investment is € 27,000, and an annual maintenance cost is estimated at € 299.59, so the payback period is 6.79 years with a 25-year IRR of 15%.
  • If we add the cumulative benefits after 25 years, the solar photovoltaic option amounts to € 11,983.20 while the hydraulic turbine amounts to € 83,329.79.
  • Perhaps the solar option with a payback period of more than 10 years loses its economic sense. On the other hand, the turbine is interesting with a return period of less than 7 years.
  • We have not taken into account the fact that any of the 2 options may also be the subject of substantial subsidies and aid from the Spanish government or the European Community.