PVsell’s calculation engine has industry-leading accuracy

PVsell’s calculation engine has industry-leading accuracy

We occasionally get asked to demonstrate the accuracy of our calculations. Rest assured, PVsell has been used by many hundreds of solar businesses since 2011, who have performed ROI calculations for over 30,000 customers. In that time, we’ve responded to the closest scrutiny from accountants and engineers alike. Because, unlike others, we provide the ability for you to look ‘under the hood’ and download the hour-by-hour results of our simulation. We’ve also designed our 25-year cashflow sheet to be easily interpreted by your customer’s accountant – as it shows the step-by-step calculations for solar value every year.

While we have to protect our Intellectual Property (including our calculations), if you get asked how you arrived at the figures produced by PVsell, you can state the following:

Hourly Calculations

  1. The solar simulation engine calculates the production of solar energy in every hour of the year, based upon the closest climate data station. PVsell uses PVwatts performance simulator, which is produced by the US Department of Energy’s National Renewable Energy Laboratory (NREL). PVwatts is the global standard used by companies worldwide. PVsell’s production data therefore accounts for the orientation and tilt of each and every solar panel. (Most spreadsheet-based solar ROI calculators only adjust their annual energy production figure for orientation and tilt).
  2. The solar production value in every hour of the year is then reduced by the specified shading amount, which can be entered at an hourly resolution for each month of the year. (Most spreadsheet-based solar ROI calculators only adjust their annual energy production figure for shading)
  3. If the inverter capacity is smaller than the solar production in any hour, then the solar production is capped at the inverter capacity. (Most spreadsheet-based solar ROI calculators don’t account for yield reduction from an under-sized inverter).
  4. PVsell then compares the solar production and the energy consumption in every hour of the year. This is the only way to accurately calculate whether the solar generation is self-consumed or export (or export-limited), and the ROI calculation is most highly dependent (sensitive) upon the accuracy of this operation. (Most other solar ROI calculators don’t perform this calculation at all and instead allow a user to ‘guesstimate’ the amount of power that is export. Because the customer has no idea how much will be exported, salespeople typically way-understate the amount of export).
  5. The value of solar generation varies depending upon the electricity tariff structure, and may vary with time (time-of-use tariff) or with amount of consumption in a given period (block-tariff). PVsell then calculates the value of the solar power that is self-consumed and export, for every hour of the year, based upon the electricity tariff structure. (Most spreadsheet-based solar ROI calculators expect the operator to enter a single electricity price – and most often salespeople will ignore any power generated during off-peak periods).
  6. Having calculated the value of the solar energy production, PVsell can also account for the benefit from any reduction in peak demand that will occur as a result of the solar power system. This calculation accounts for difference between the pre-solar peak demand and the post-solar peak demand in each month (or annually, depending on the tariff structure) and time-of-use period (if applicable). The calculated reduction in peak demand can be monetised or treated as ‘icing on the cake’. (Most spreadsheet-based solar ROI calculators can’t calculate peak demand reduction as they lack the necessary information).
  7. If the solar power system attracts LGCs, PVsell accurately calculates the number of LGCs based upon the shade-affected, orientation & tilt-adjusted, inverter-constrained, export-limited solar production.

Annual Calculations

Having calculated the financial benefits from the first year, financial calculations in subsequent years include:

  1. A progressively reducing solar yield (annual degradation)
  2. Electricity price rises
  3. LGC prices and quantity created in each year
  4. Upfront costs, finance repayments, ongoing maintenance and replacement equipment (if specified by the user)

As you can see, PVsell’s ROI calculation accuracy is second-to-none.

Accountants can also verify the information produced by:

  1. Seeing the total annual solar generation in each year, broken down by how much is export versus how much offsets electricity consumption during peak, shoulder, and off-peak periods.
  2. Seeing the tariff that applies during peak, shoulder, and off-peak periods, and seeing the feed-in tariff for export energy
  3. Seeing the amount of financial benefit produced in each of the peak, shoulder, and off-peak periods, plus the amount of financial benefit produced from solar exports – which can be cross-checked by multiplying the values from the steps before
  4. Summing these financial benefits together to form the total financial benefit from solar energy production
  5. Adding any benefit from a reduction in peak demand, whose calculations are also displayed.
  6. Cross-referencing against the electricity bill before-and-after solar breakdowns, to cross-check and confirm the benefit produced by the solar power system.

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