A bottom-up approach for estimating the economic potential of the rooftop solar photovoltaic system considering the spatial and temporal diversity

To successfully deploy distributed solar generation in urban environments, it is essential to investigate the potential to generate electricity from the rooftop solar photovoltaic (PV) system within a region. While various interpretations are possible for the rooftop solar PV potential, most of the previous studies focused on estimating the technical potential, not considering the economic viability and market dynamics. Therefore, it is necessary to estimate the economic potential of the rooftop solar PV system to quantify the amount of economically viable solar PV energy within a region and to evaluate the impact of the various factors affecting market access. Towards this end, this study proposed a bottom-up approach for estimating the economic potential of the rooftop solar PV system considering the market dynamics by adoption year. Accordingly, the economic potential of the rooftop solar PV system was estimated for the Gangnam district in Seoul, South Korea from 2008 to 2016. In terms of power capacity, it was analyzed that as of 2016, the actual installed capacity of the solar PV system in the Gangnam district was only 3% of the maximum economic potential of the rooftop solar PV system (i.e., economic potential for electricity business purposes), showing a high potential for additional rooftop solar PV adoption. In terms of electricity generation, it was shown that as of 2016, the annual economic potential of the rooftop solar PV system could supply up to 4.48% of the annual electricity consumption in the Gangnam district, while only 0.12% could be supplied from the annual electricity generation of the actual installed solar PV system. This study has significant contributions in that it took one step farther towards the rooftop solar PV potential estimation process, from the technical potential to the economic potential, considering the spatial and temporal diversity of the solar PV technology.