The economic influence of photovoltaic technology on electricity generation: A CGE (computable general equilibrium) approach for the Andalusian case

Abstract

This paper provides an estimation of the socio-economic impacts of increasing the production capacity of installed solar parks in Andalusia (southern Spain). Solar parks use photovoltaic technology for electricity generation. A CGE (computable general equilibrium) approach is used to capture impact assessments of an increased roll out of solar parks in Andalusia on production activities, employment and other macroeconomic variables as a consequence of increasing power output by this means to 400 MW by 2013 as stipulated in the program named as ‘PASENER (Plan Andaluz de Sostenibilidad Energética) 2007 e2013’ implemented by the Andalusian Regional Government. Results show that compliance with the PASENER goal would increase the activity level of the economic sectors considered by 3.1 %, and total employment generated would reach 215,148 equivalent full time jobs lasting one year. The other macroeconomic variables considered would also increase. The deployment of the photovoltaic technology would provide up to 527,573 tonnes of CO2 abatement if it displaces an equivalent installed capacity of thermal plants.