Economic Feasibility Investigation of On-Grid and Off-Grid Solar Photovoltaic System Installation in Central Java

Abstract

Solar energy, as the most abundant renewable energy source, has garnered significant attention for its potential in electricity generation. Photovoltaic (PV) panels, capable of converting solar energy into electricity, have been widely considered for residential applications, including on-grid and off-grid systems. This study seeks to evaluate the economic feasibility of implementing on-grid and off-grid solar PV systems in residential settings through a case study in Gemolong, Sragen. The Hybrid Optimization Model for Electric Renewable (HOMER) software is employed to simulate these systems, providing an economic analysis over a specified time period. Results indicate that the on-grid system presents a more favorable option for the Gemolong region, owing to its optimized monthly production, minimal maintenance costs, and investment potential. The total installation cost for the on-grid system is estimated to be Rp 64,985,200.00, compared to the off-grid system's cost of Rp 745,731,208.82. Furthermore, the on-grid system demonstrates a 13.3% advantage in energy production. Based on the energy and economic analyses, the on-grid PV system is recommended for adoption in the Gemolong area.