The main applications for off-grid PV are:
- Remote households and communities where connection to the grid is not possible.
- Where connecting to the grid would be more expensive than using a PV system.
- In urban and semi-urban areas where installing low-power systems can cost less than connecting to the grid, which might involve laying underground cables.
- Replacing diesel and petrol generators.
- Reducing diesel generator running times.
- Where the regular supply of diesel fuel might be a problem.
- Telecom base stations.
- Water pumping for human consumption, livestock and crop irrigation, and other productive uses of energy.
Typical cost breakdown of an off-grid PV system over the service life of the system. The batteries are the most expensive system component because they need to be replaced several times over the life of the system. Note that systems are different and, thus, proportional costs will vary.
The economics of a situation need to be determined case by case, taking into consideration the levelised cost of the electricity (LCOE) that a system will produce. LCOE is the total lifetime cost of the system divided by the total lifetime electricity generated by the system. It will depend on the initial system cost, the subsequent cost of replacement batteries, and on how well the system is operated and maintained, as well as on the level of solar irradiation at the site. A PV system’s LCOE can be compared with the LCOE of a diesel generator system (where a very significant cost factor will be the fuel consumption) to see which is more economically attractive. Software can be very useful when doing detailed cost analyses of larger off-grid PV systems.