Blog > Project Development

Accurately Calculating the Avoided Cost of a Solar Project?

Calculating “avoided cost”, which is how much a project saves in dollar terms, is a critical part of the solar project development process. In this video tutorial we look deeply at how avoided cost gets calculated, explaining the difference between how much a customer pays ($/kWh average blended cost) and how much a customer saves ($/kWh average blended savings).

We model a number of real world examples to illustrate how the $/kWh avoided cost changes, based on the project assumptions, like the customers’ unique load profile, which utility rate schedule they are on and/or switch to, and the design parameters of the solar system. At the end of the video we demo how the Energy Toolbase platform can optimize the avoided cost of a project, based on all these inputs.

It’s very important for solar salespeople to understand how savings (aka avoided cost) gets calculated. As an industry we have a moral obligation to present accurate and realistic savings estimates to customers.

Recent Posts

Blog Categories

Follow us on

Upcoming Webinars


Get our content straight to your inbox

subscribe to our monthly newsletter and receive our blogs, webinars and other announcements.