Introduction

In the past two decades there has been considerable advancement in solar photovoltaic power generation system deployment. Nevertheless, for numerous reasons financing institutions (because of lack of in-depth appreciation of the technology) have consistently refused to take advantage of great investment opportunities that are inherent in medium to large-scale solar power cogeneration systems.

This chapter is intended to clarify some of the ambiguities of solar power photovoltaic system technologies by familiarizing the reader with the fundamental aspects of solar power technology in lay terms and highlighting all aspects of cost components that typify various types of solar power systems.

The financial analysis methodology reflected in this paper is based on pragmatic, real life design, construction, and unique financing scenarios, which are rarely discussed or analyzed by financial banking or lending institutions and investors.

Unlike well-established technologies such as construction, manufacturing, transportation, and energy sector financing, solar power photovoltaic technologies are relatively new. Regardless, this somewhat unfamiliar sector of the industry has been advancing at great pace despite the lack of a financial performance legacy and lack of a specific analytical methodology. Lending institutions have not had the opportunity to study intricacies of the solar power technology in order to develop and establish specific lending policies that are unique and unlike those of any other sectors of the economy.