Investment decision support for zero subsidy wind and solar – An optimization based simulation approach

In the past decade, variable renewable energy sources became increasingly competitive due to rapidly falling manufacturing costs. However, prices cannibalization could lead to limited market driven investments. In this paper, we present a method to use a dispatch model to find an investment decision that can account for country risk factors such as social acceptance as well as the fundamental factors that influence the power market such as existing capacities and fuel prices. Results show that Solar PV is more affected by price cannibalization and Spain has large unrealized potential for market driven Solar PV investments.