Evaluation of incentive mechanisms for distributed solar power generation in San Juan, Argentina

Abstract

The province of San Juan in Argentina presents significant values of solar radiation that stimulate the development of distributed solar photovoltaic generation. Moreover, National Law 27.424 proposes Net Billing as an incentive mechanism for renewable energy sources. This work analyzes the profitability of photovoltaic systems in the residential sector under current electricity costs and fare conditions. The results show that, on average, the leveled cost of photovoltaic generation is 20% higher than the average value of the fares for residential users. It is necessary to apply incentive mechanisms as proposed in Law 27.424 to achieve grid parity. The Net Metering mechanism would be more profitable for photovoltaic system owners but could adversely impact utility incomes.