Profitability of Various Energy Supply Systems in Light of Their Different Energy Prices and Climate Conditions

Abstract

The majority of the single-family houses in Sweden are affected by deteriorations in building envelopes as well as heating, ventilation and air conditioning systems. These dwellings are, therefore, in need of extensive renovation, which provides an excellent opportunity to install renewable energy supply systems to reduce the total energy consumption. The high investment costs of the renewable energy supply systems were previously distinguished as the main barrier in the installation of these systems in Sweden. House-owners should, therefore, compare the profitability of the energy supply systems and select the one, which will allow them to reduce their operational costs. This study analyses the profitability of a ground source heat pump, photovoltaic solar panels and an integrated ground source heat pump with a photovoltaic system, as three energy supply systems for a single-family house in Sweden. The profitability of the supply systems was analysed by calculating the payback period (PBP) and internal rate of return (IRR) for these systems. Three different energy prices, three different interest rates, and two different lifespans were considered when calculating the IRR and PBP. In addition, the profitability of the supply systems was analysed for four Swedish climate zones. The analyses of results show that the ground source heat pump system was the most profitable energy supply system since it provided a short PBP and high IRR in all climate zones when compared with the other energy supply systems. Additionally, results show that increasing the energy price improved the profitability of the supply systems in all climate zones.

Keywords

• single-family house
• energy supply system
• payback period
• internal rate of return
• energy price
• Swedish climate zones