By Olivier Rebenaque
By generating their own electricity with photovoltaic (PV) panels, households are less dependent on the grid. However, because there is a mismatch between PV generation and consumption, the economic benefits from the bill savings are usually low compared to the economic compensation of the excess electricity fed into the grid. The economic benefits may drop by the implementation of Time-of-Use tariffs or capacity tariff because the prices and the peak load might be higher in the evening at night when PV generation does not occur. Stationary batteries might increase PV self-consumption by storing PV production when electricity prices are low and releasing it during peak prices. However, Feed-in-tariffs applied on the excess generation does not encourage prosumers to invest in a battery. In this paper, we assess the profitability of a PV investment under the current French subsidy scheme. Then, we propose an alternative policy which guarantees an upfront purchase subsidy for the PV and battery investments but without Feed-in tariffs. Based on this alternative policy, we simulate economic benefits from various PV and battery capacities with different pricings. We show that PV self-consumption investment is more profitable with Feed-in tariffs than with a battery premium under Time-of-Use and capacity tariff. Nonetheless, the current subsidy scheme is costly compared to the implementation of a battery premium. Thus, some policy recommendations are provided to improve subsidy scheme.