Revenue calculation

The revenue calculation is the income side of the working sequence. Revenue is not decided by the quantity generated but by the way it is used: the same kilowatt hour is valued differently depending on whether it is used on site, stored, fed into the grid or delivered as heat. The system of revenue types is described by the fundamentals page Revenue calculation; this page shows the way to quantities and prices inside the program.

The prerequisite is a fully calculated annual profile; save the simulation result for every project so that it remains traceable which set of quantities the revenues are based on. In the sequence, the revenue calculation sits between the cost module and the economic analysis: the cost module supplies the price basis, the simulation the quantities, and the Economic analysis brings both together over the assessment period.

Energy prices as the basis

The price basis is maintained under Administration › Energy carriers and cost parameters: for every energy carrier the working price, the standing price and – where applicable – the demand price, plus net and gross calorific value, unit conversion and emission factors, each with a validity date, from which a price history arises. The same master data carry the cost side, the revenue side and the emission balance.

For electricity three quantities of very different weight have to be distinguished: purchase price, avoided purchase through self-consumption and feed-in remuneration. Electricity used on site replaces grid supply at the full working price including network charges, levies and surcharges; electricity fed into the grid is remunerated under the applicable rules and is usually well below that. Standing and demand price do not depend on the energy drawn: the standing price stays unchanged, and the demand price only falls if own generation actually reduces the annual peak load.

Bonuses for electricity from combined heat and power, feed-in remuneration, avoided network usage charges and energy tax refunds are to be applied as a system; rates, deadlines and conditions change frequently and have to be checked for the individual project.

Quantities from the simulation

On the electricity side EPOS-Plan keeps the balance in 35,040 quarter hours per year – in hourly averages self-consumption and storage management would come out too favourable. In every time step the order of precedence is direct use, storage charging, feed-in; if generation is not sufficient, the storage is discharged first and the remainder is grid supply. Purchase price, remuneration and bonuses are to be applied to these quantities.

On the heat side the simulation calculates 8,760 hours and reports heat production, coverage share, operating hours and fuel consumption by energy carrier for every generator, plus residual demand and surpluses. These quantities can be read on the results page, in the module tables of the result areas, in the self-sufficiency analysis and in the electricity chart with the storage level; all time series are available as CSV files with time stamp and ambient temperature.

Valuing the individual components

Photovoltaics. The yield falls into three quantities: electricity used directly at the avoided purchase price, storage charging and the surplus fed in at the applicable remuneration. Several sub-arrays shift above all the timing of the yield and thus this split; background under Photovoltaics.

Battery storage. It generates no revenue of its own; its contribution arises from reallocation: electricity that would otherwise have been fed in replaces grid supply later. What has to be valued is the difference between purchase price and feed-in remuneration, applied to the discharged quantity less the losses; more under Battery storage.

CHP and combined heat and power. As with photovoltaics, the electricity is split into quantities used on site and quantities fed in; on top come the bonuses for electricity from combined heat and power, which differ in amount for the two quantities. The heat is remunerated as a delivery or applied as supply avoided at the reference. Because the operating mode – heat-led, electricity-led or without feed-in – shifts this split, it is one of the most effective quantities on the revenue side; more under Combined heat and power.

Heat pump. It generates no revenue but changes both sides of the balance: its electricity demand including back-up heater and auxiliary drives increases the consumption against which self-consumption is measured; its heat contribution is to be applied as fuel input avoided compared with the reference. The operating mode – runtime-, output- or PV-optimised – determines how strongly consumption and own generation coincide.

Boilers and electric boilers. In the reference variant the boiler supplies the yardstick: its fuel costs are the quantity another variant avoids – without a clean reference, every assumption about avoided costs remains undefined. In the target variant it covers peak load and residual demand and is valued with these quantities only. An electric boiler is modelled through the energy carrier electricity and can absorb surpluses – with the worst efficiency of all the options.

Solar thermal. The revenue consists solely of avoided fuel or electricity of the generator that is displaced. What matters is not the collector yield but the share of it actually used: yields that cannot be used are reported by the simulation as surplus and remain unvalued – the surplus thus determines the sizing of the collector array.

Buffer tank. It too contributes no revenue of its own but shifts operating times: it extends the CHP running time and makes PV-optimised operation of the heat pump possible. Against this stand the standby losses – they raise heat production above heat demand, and this difference does not earn revenue.

Heat delivery. With a local heating network or contracting, revenue arises from working, standing and, where applicable, demand price. What is to be applied is the quantity delivered at the transfer point, not the quantity generated – the network losses recorded in the heat demand as a percentage or annual figure and the storage losses have to be deducted from it.

Key figures of electricity utilisation

The self-consumption ratio states which share of your own generation stays in the object, and falls as the plant grows; the self-sufficiency ratio states which share of the demand is covered from own generation, and rises with it. Economically the self-consumption ratio weighs more heavily: it describes the share of the quantity that is valued at the full purchase price. The share of storage discharge in demand coverage shows which part of it the battery makes possible in the first place, the remaining feed-in the quantity flowing off at the lowest rate; the self-sufficiency analysis compares both month by month. A high self-sufficiency ratio alone is no proof of economic viability – it can be bought with a larger plant.

Levers for more self-consumption

An east-west split of the photovoltaic array broadens the generation profile at the expense of the midday peak and thus meets demand more often; a battery store carries it into the evening. The PV-optimised operating mode of the heat pump uses buffer tank and building mass as a thermal store – often the more effective lever, because thermal storage capacity is cheaper than electrical. With a CHP unit, electricity-led operation shifts generation into periods of high own demand; operation without feed-in prevents delivery to the grid altogether. Change only one quantity at a time and calculate again; because every measure triggers investment, the additional revenue has to be set against the additional cost.

Notes for practice

More operating hours do not automatically mean more revenue. With electricity-generating plants, check whether the revenue of a kilowatt hour exceeds the marginal costs – fuel and consumption-dependent maintenance; if generation falls predominantly into periods without own demand, an operating hour can arithmetically produce a loss.

Time-limited remunerations and bonuses belong in the net present value analysis, not in an annual average: they usually expire before the end of the assessment period. Apply every quantity only once as well – as revenue or as reduced energy costs, not as both.

Keep the prices up to date with their validity date – purchase prices, remunerations and fuel prices develop at different speeds; an outdated set of prices devalues the comparison of variants. Also check whether own generation lowers the peak demand: the annual profile of the electricity demand shows when the annual maximum occurs and whether own generation is available at that time.

How these revenues combine with the costs to give net present value, annual costs and heat generation costs is described by the subpage Economic analysis, the emission side by the subpage Emissions and the output by Creating the report; all steps in context are shown by the page Program workflow. The background is collected under Fundamentals › Revenue calculation and Cost calculation, worked cases under Examples.