Analysis of the effect of switching from FIT to RPS on grid parity for photovoltaics in Korea: using learning curve model

Abstract

Renewable energy (RE) electricity, such as photovoltaic (PV) power generation, has the benefits of strengthening energy security, addressing climate change, reducing air pollution, etc., but there are some impediments to deployment of RE electricity: higher costs than fossil fuels, intermittent energy production, site constraints, etc. Korea changed its RE electricity support systems from feed-in tariff (FIT) to a renewable portfolio standard (RPS) in 2012. This study evaluates FIT versus RPS in terms of the time to reach grid parity for PVs. Using a learning curve model, we calculate the learning rate of PV power generation during the FIT and RPS periods. We find that the PV learning rate during the RPS period was 18.44%, much higher than that during the FIT period, -0.28%, and $R^{2}$ is 0.9861 and 0.7346 in the RPS and FIT periods, respectively. Using the calculated learning rate in the RPS period, we also predict that grid parity for PVs is expected in 2025 in Korea.