Comparison of support policies for residential photovoltaic systems in the major EU markets through investment profitability

In this paper a comprehensive evaluation of the support policy for photovoltaic installations in the residential sector of the major European markets (Flanders (Belgium), Germany, Italy, Spain and France) is carried out. To this end, the economic viability of a household investment in a photovoltaic installation is studied, employing a model based on the discounted cash flows of the installation over its lifetime. The results indicate that Italy's support system has been the most profitable out of the countries studied since 2010. In general, under current support policies, residential installations are still profitable in most cases, despite decreasing support levels, except for Spain. Furthermore, the paper demonstrates that self-consumption can significantly increase profits, especially in Spain and Germany. However, Flanders' policy has no effect on levels of self-consumption. Finally, a comparison of past and present policies shows the varying levels of success countries have enjoyed in keeping the profitability of investments stable over the years, depending on the efficiency of their support policy. Germany's support system might be considered the most balanced one over the last five years.