Economics of Grid-Tied Solar Photovoltaic Systems Coupled to Heat Pumps: The Case of Northern Climates of the U.S. and Canada

Abstract

Solar photovoltaic (PV) technology is now a profitable method to decarbonize the grid, but if catastrophic climate change is to be avoided, emissions from transportation and heating must also decarbonize. One approach to renewable heating is leveraging improvements in PV with heat pumps (HPs). To determine the potential for PV+HP systems in northern areas of North America, this study performs numerical simulations and economic analysis using the same loads and climate, but with local electricity and natural gas rates for Sault Ste. Marie, in both Canada and U.S. Ground-mounted, fixed-tilt, grid-tied PV systems are sized to match 100% of electric loads considering cases both with and without air source HPs for residences with natural gas-based heating. For the first time the results show North American residents can profitably install residential PV+HP systems, earning up to 1.9% return in the U.S. and 2.7% in Canada, to provide for all of their electric and heating needs. Returns on PV-only systems are higher, up to 4.3%; however, the PV capacities are less than half. These results suggest northern homeowners have a clear and simple method to reduce their greenhouse gas emissions by making an investment that offers a higher internal rate of return than savings accounts, CDs and GICs in both countries. Residential PV and solar-powered heat pumps can be considered 25-year investments in financial security and environmental sustainability.

Evaluation of Transfer Learning and Fine-Tuning to Nowcast Energy Generation of Photovoltaic Systems in Different Climates

“…Over the last twenty years, PV systems have been integrated as efficient sources of energy generation and this technology has reached a significant maturity level in several regions, such as America [17,18], Australia [19], Asia [20] and Europe [21]. The role of Machine Learning has enabled a relevant number of applications in PV installations [22].…”

The Agrivoltaic Potential of Canada

“…Due to perpetual decline in solar photovoltaic (PV) systems costs [1,2], the least expensive source of electricity generation is now solar energy [3,4]. The cost reductions have become substantial enough that PV-generated electricity can be used to subsidize heat pumps, which enables the profitable electrification of gas-based heating in Canada [5]. In addition, the current operational cost of electric vehicles (EVs) warrants electrification of transport [6], which has the potential to be a major economic engine in Canada [7][8][9].…”

Agrivoltaics in Ontario Canada: Promise and Policy

“…Throughout Canada, grid-connected PV systems are at grid-parity or beyond with the return on investment (ROI) of PV applications varying by province and utility [5]. PV can even be used to economically subsidize heat pumps to enable profitable electrification of gas-based heating in Ontario [6]. Unsurprisingly, PV electricity production in Canada continues to grow, although it makes up less than 1% of electricity generation, while Ontario is the dominant province for PV deployment with approximately 94% of Canada's total cumulative installed capacity [5].…”