The Relationship Between Photovoltaic Distributed Generation And Power Grid

Relationship between photovoltaic distributed power generation and power grid

Distributed photovoltaic power generation, as a clean energy utilization method close to the user side, has both significant advantages and objective challenges. Its advantages and disadvantages need to be comprehensively analyzed from multiple dimensions such as technology, economy, environment, and society:

1. High energy utilization efficiency and reduced transmission and distribution losses

Nearby consumption: The power generation end and the power consumption end are highly coupled (such as industrial and commercial roofs, residential areas), and electricity does not need to be transmitted over long distances, reducing the transmission loss of 7%-10% of the traditional power grid and improving energy utilization efficiency.

Peak shaving and valley filling: During peak power consumption periods (such as summer afternoons), distributed photovoltaics can directly supplement local loads and relieve power grid pressure (such as a photovoltaic system in an industrial park meets 30% of peak power consumption and reduces demand electricity charges by 50%).

2. Direct economic benefits and clear return on investment

Self-generation and self-use save electricity costs: users meet their own electricity needs at a cost lower than the grid electricity price (e.g., the cost of photovoltaic electricity is 0.055-0.082 US dollars, which is lower than the industrial and commercial electricity price of 0.8-1.5 yuan), significantly reducing electricity costs.

Surplus power grid connection increases income: Through the "net metering" or "full grid connection" mode, excess electricity can be sold to the grid according to the electricity price or subsidy policy (e.g., the purchase price of household photovoltaic surplus electricity in Germany is 0.15 euros/kWh, covering about 40% of the investment cost).

Long-term stable income: The life of photovoltaic modules is 25-30 years, the maintenance cost during the operation period is low (about 1%-2%/year of the initial investment), and the IRR (internal rate of return) can reach 8%-15%, which is better than most traditional investments.

3. Significant environmental benefits, helping carbon neutrality

Zero-carbon power generation: Each 1kWp distributed photovoltaic power generation has an annual power generation of about 1200kWh, which is equivalent to reducing CO₂ emissions by 1 ton (calculated based on the thermal power emission factor of 0.85kg/kWh), which is in line with global emission reduction targets (such as China's "dual carbon" strategy, the installed capacity of distributed photovoltaic power will exceed 150 million kW in 2023).

Decentralized carbon reduction: No large-scale land acquisition or long-distance transmission corridors are required, avoiding ecological damage to traditional energy projects, suitable for multiple scenarios such as cities and villages.

4. Strong flexibility, adaptable to multiple scenarios

Diversified scenarios: It can be installed on roofs, carports, agricultural greenhouses (agricultural and photovoltaic complementarity), water surfaces (fishery and photovoltaic complementarity), etc., to activate idle space (for example, a Shandong company used the roof of the factory to build a 5MW photovoltaic power plant, with an annual power generation of 6 million kWh, meeting 40% of electricity consumption).

The capacity can be large or small: from 3-10kW for household use to hundreds of kW to MW for industrial and commercial use, it can adapt to different user needs, with a short construction period (usually 2-3 months), and can be expanded in stages.

5. Improve energy security and reliability

Grid auxiliary support: As a distributed power source, in the event of a grid failure (such as a local power outage), it can form a "microgrid" with the energy storage system to ensure the power supply of key loads (such as photovoltaic + energy storage systems in hospitals and data centers).

Reduce external dependence: Reduce users' dependence on centralized power grids (especially coal-fired power), and stabilize electricity costs when energy prices fluctuate (such as the surge in European electricity prices in 2022).

1. Intermittent and Dependency of Power Generation

Affected by the weather: The output power fluctuates with the intensity and duration of light (the power generation on rainy days is only 20%-30% of that on sunny days), and it cannot independently meet the all-weather power demand, and needs to rely on the grid or energy storage (the energy storage cost accounts for 30%-50% of the system investment).

"Power outage" at night: When there is no light, it is necessary to purchase electricity completely from the grid. In essence, it is still "grid supplement" rather than "replacement" (such as Beijing's annual self-sufficiency rate of household photovoltaics is about 40%-60%, and even lower in winter).

2. High initial investment and long payback period

Preliminary cost barriers: The system cost is about US$0.41-0.68/Wp (including components, inverters, brackets, and grid connection costs), and the initial investment of a 10kW system is US$4,100-6,800. Although the payback period is about 5-8 years, there is still financial pressure on small and medium-sized users.

Subsidy dependence: In areas without subsidies (such as some developing countries), the cost per kilowatt-hour is higher than the grid electricity price, and commercial feasibility is reduced (for example, the IRR of India's unsubsidized projects is only 5%-7%, which is lower than the financing cost).

3. Technical challenges to distribution networks

Power quality issues: Inverter conversion generates harmonic pollution, which may affect surrounding power-consuming equipment (filters need to be configured, increasing costs by 5%-10%); centralized access to distributed power sources may cause local voltage over-limits (for example, when the photovoltaic power station in rural areas is overloaded, the voltage rises to more than 250V).

Complexity of relay protection: Traditional distribution networks are designed for "unidirectional flow", and bidirectional power flow may cause misoperation of protection devices (such as islanding effects that threaten maintenance safety), and intelligent distribution systems need to be upgraded (the transformation cost is about US$13,700-27,400/station).

Increased scheduling difficulty: In high-penetration scenarios (such as distributed photovoltaic power stations in some areas of the Netherlands account for more than 40%), the power grid needs to frequently adjust the output of traditional power sources or energy storage to balance real-time supply and demand, thereby increasing operating costs.

4. Space and installation restrictions

Roof condition constraints: sufficient sunlight (30°-45° tilt angle is best), load-bearing capacity (≥20kg/m²), and no obstruction (such as surrounding trees, building shadows). Urban high-rise buildings or old roofs have low adaptability (for example, less than 30% of eligible roofs within the inner ring of Shanghai).

Aesthetics and compliance disputes: Some communities or historical buildings restrict photovoltaic installation (for example, France stipulates that photovoltaic modules must be coordinated with the color and material of the roof), which increases the difficulty of project implementation.

5. Maintenance and full-cycle management requirements

Regular maintenance is necessary: ​​Module dust accumulation, glass breakage, inverter failure, etc. require regular inspections (recommended once a quarter). Cleaning can increase power generation by 5%-10%, but labor costs increase with project scale (for example, the annual maintenance fee for a 1MW project is approximately US$6,850-10,960).

Disposal of retired components: After 25 years, the efficiency of components drops below 80%, and standardized recycling is required (the global recycling rate is currently only 15%. Although China has issued the "Technical Specifications for Photovoltaic Module Recycling", the industry chain is not yet mature).

6. Uncertainty of policies and market environment

Risk of subsidy reduction: PV subsidies in various countries are gradually reduced (for example, China's distributed PV subsidies in 2023 will drop by 50% compared with 2020), and the income of projects that rely on subsidies may shrink.

Grid connection process is cumbersome: In some regions, the approval cycle for grid access is long (for example, Brazil takes 6-12 months), and it may require prepayment of grid upgrade fees (for example, Chile charges a connection fee of US$100,000 to US$200,000 for MW-level projects).

The advantages of distributed photovoltaic power generation are particularly prominent in high-electricity price areas, stable electricity consumption and concentrated load scenarios (such as industry, commerce, and public buildings), while the disadvantages are more prominent in scenarios with weak power grids, insufficient subsidies, and harsh installation conditions.

Optimization path:

Technical level: Promote "photovoltaic + energy storage" coupling (smooth output, increase self-sufficiency to 80%+), develop high-efficiency components (such as TOPCon, HJT, reduce unit capacity footprint).

Policy level: Improve grid connection standards (simplify processes), establish component recycling systems, and explore "virtual power plant" aggregation compensation mechanisms (such as Germany allows distributed photovoltaics to participate in grid frequency regulation and obtain auxiliary service benefits).

Business model: Develop "photovoltaic leasing" (reduce user initial investment) and "energy management contracts" (EMC model, owners share benefits with zero investment).

In the future, with technological progress (cost reduction) and the intelligent upgrade of the power grid, the shortcomings of distributed photovoltaics will gradually weaken and become the core carrier of "decentralization" and "resilient power grid" in energy transformation.