INGENIEUR Figure 3: Past Trends and Forecasted Average Electricity Tariff vs Solar PV Electricity Generation Cost Source: MPIA Proposal for Net Energy Metering Program 2016-2030, [Ref.4] 60% of the capital costs in these technologies, but they could follow a ‘semiconductor-like’ improvement in price performance. In addition, panel installation, usually a fifth of the cost, can be made quicker and cheaper through GPS- guided power tools and robots. Overall, it is estimated that technology improvements could reduce Large-Scale Solar PV power plant cost to 65% of its capital expenditure of what it is now by 2025 as shown in Figure 2. According to Malaysian Photovoltaic Industry Association (MPIA) forecast report, [Ref 4], year 2020 LCOE for utility-scale solar photovoltaic generation (10 MWp to 50 MWp range) plus transmission & distribution grid asset utilisation costs would be about 39 sen/kWh, which is lower than the forecast average electricity tariff of about 45 sen/kWh, as shown in Figure 3. Grid-connected distributed solar photovoltaic generation, principally solar panels used to power individual households or supply part of a building’s energy requirements, enjoys a large share of overall solar power production in some countries, such as the UK, the Netherlands and Singapore, where more than half of renewable generation is residential (mostly rooftop solar). Distributed generation could also provide other benefits, 6 46 VOL VOL 75 55 JULY-SEPTEMBER JUNE 2013 2018 such as lower line losses due to shorter distances transmitted, productive use of unutilised rooftops, and environmental benefits. It could be particularly relevant for heavily-congested areas where adding new infrastructure is impractical. If renewable solar PV generation costs continue to fall and energy storage capabilities/ efficiencies grow rapidly, it can be envisioned that entire neighbourhoods or factory complexes may be served using distributed solar photovoltaic power generation and localised distribution smart grid infrastructure. This could make remote housing and manufacturing plants more viable by reducing the transmission capacity required from the central transmission grid or even eliminating the need to access the transmission grid altogether. Future Power System: High Flexibility Requirement The flexibility of the system represents its ability to accommodate the variability and uncertainty in the demand-generation balance while maintaining satisfactory levels of performance over a given timescale.