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 Title: An economic valuation of solar energy potential in Nigeria Author(s): Ogunnubi, Oladipupo A Department / Program: Electrical & Computer Eng Discipline: Electrical & Computer Engr Degree Granting Institution: University of Illinois at Urbana-Champaign Degree: M.S. Genre: Thesis Subject(s): Nigeria Monte Carlo Levelized cost of energy (LCOE) Benefit-cost ratio (BCR) Net present value (NPV) Payback Reliability Power Africa Solar Photovoltaic Economics Valuation Power Africa Renewables Abstract: Nigeria has a population of over 160 million, and just over 50\% have electricity access. Many initiatives promote solar energy development to mitigate Nigeria's power challenges. This work shows an economic valuation of the solar photovoltaic (PV) potential in Nigeria. Assuming a 100 megawatts (MW) capacity upgrade, this paper compares distributed residential-scale and centralized utility-scale PV configurations under lower 2013 and higher 2016 PV project cost assumptions. Metrics such as levelized cost of energy (LCOE), benefit-cost ratio (BCR), net present value (NPV), and payback period, are assessed. A sensitivity analysis is performed to consider the effects of inflation. Our results show that all expected LCOE values under 2013 cost assumptions are above $0.30 per kilowatt-hour (kWh) while expected LCOE values for the 2016 cases are less than \$0.30 per kWh. Expected BCR values for residential PV at 2013 PV costs increased from 1.01 to 3.37 before and after inflation effects, respectively. Expected BCR values for the utility PV case increased from 1.36 to 3.93 before and after inflation effects. Results show that expected NPV results for all 2016 cost scenarios are greater than those for 2013 scenarios. In addition, two scenarios show no possibilities of payback while the two other scenarios break-even as early as 6 and 6.5 years at best. In light of the major effect that PV project costs have on overall LCOE, it is recommended that government provide incentives that directly tackle initial project costs. These incentives should be founded and enforced on solid renewable energy policy, framework, and infrastructure. In terms of future work, we look to include reliability benefits and transmission expansion economics into the economic model as solar capacity upgrades may require transmission system upgrades. There is also an opportunity to apply optimization theory to obtain the conditions for which LCOE, BCR, NPV, and payback are optimized under specific economic and power system constraints. Issue Date: 2015-04-27 Type: Thesis URI: http://hdl.handle.net/2142/78508 Rights Information: Copyright 2015 Oladipupo Ogunnubi Date Available in IDEALS: 2015-07-22 Date Deposited: May 2015
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