Impact of the fixed and variable component of electricity price on the economic viability of a small-scale photovoltaic power plant

The article analyzes electricity prices in Slovakia, their distribution tariff component, and their significant impact on small-scale photovoltaic power plants (PVPs). Fixed part of the distribution tariff component in Slovakia varies considerably, given the region of operation of the distribution system operator as well as the allocated tariff rate. Profitability of the small-scale PVP in Slovakia is widely discussed, with differing opinions of the lay and professional public. The article will explain under what circumstances all the opinions may be true. Profitability predictions available online or done by PVP installers are extremely simplified and lead to misleading results. The existence of fixed and variable components of the price plays a significant role and a simple change of the electricity tariff may bring significant savings and shorten the payback time of the PVP investment. However, this is a complex issue and requires several other factors to be considered, too. The most important ones are the fixed component of the electricity price, household consumption diagram and the distribution system to which the household is connected.