The production costs for one kWh of electricity from the roof are calculated according to the formula for calculating the "Levelised Cost of Electricity" (LOCE), which is widely used in the electricity generation sector. The following parameters are considered: initial investment costs, annual maintenance costs, annual production volume, useful life, and discount rate.
The discount rate is used to discount the income and expenses of the project. This ensures that all future cash flows are considered with an estimated present value. This approach is used to reflect the fact that future cash flows cannot be compared 1:1 with today's payments due to interest rates. Discounting future cash flows is a common method for valuing investment projects. For example, to discount an investment project PV plant that has a relatively low risk, a discount rate could be used that corresponds to a relatively "risk-free" investment, e.g., the investment of money in a bank account.
On the Eturnity Platform, the discount rate is to be entered in the field "Opportunity costs". With this rate you determine how high the return on the investment is with which you want to compare the PV system, as explained above for example the cash investment in a bank account.
The default values for the annual maintenance costs (e.g., for photovoltaic systems and battery storage) can be adjusted by you. If a new project is created, it is initialised with the default values. You can then adjust the annual maintenance costs individually for each project. Please contact our customer support or your customer advisor if the default maintenance costs for your company are to be adjusted.
Note: When determining the maintenance costs for batteries, it is important to consider that you should set the amount so that any reinvestment at the end of the service life after X years divided over the PV service life should also be included. In the simulation, any necessary reinvestment in a battery after X years is only considered in this form.