World Applied Sciences Journal 6 (4): 474-481, 2009 ISSN 1818-4952 © IDOSI Publications, 2009 Corresponding Author: Wan Rahmah Mohd Zaki, Faculty of Architecture, Planning and Surveying, Universiti Teknologi MARA, Seksyen 3, 40000 Shah Alam, Selangor, Malaysia 474 Making Economic Sense of Green Energy: Photovoltaic Application in Two Houses, Bangi, Malaysia Wan Rahmah Mohd Zaki, Abdul Hadi Nawawi, Sabarinah Sh Ahmad Faculty of Architecture, Planning and Surveying, Universiti Teknologi MARA, Seksyen 3, 40000 Shah Alam, Selangor, Malaysia Abstract: The reality bites for ‘green energy’ when the economic assessment shows it as not a viable investment. Economic assessment for projects normally uses Return on Investment (ROI), Payback Period (PBP), Life Cycle Assessment (LCA), Life Cycle Cost (LCC) and Cost Benefit Analysis (CBA). Several studies have argued against these tools; but they are common due to lack of alternatives. To demonstrate the detrimental effect of these tools, they are applied in two simulation cases known as Passive Architecture (PA) case and non PA case that intend to use photovoltaic (PV) as a power source for mechanical cooling in the living/dining area. In all situations, ROI, PBP and LCC portrayed PV as unfavorable investment mainly due to its high capital cost that dwarfs the likely financial gain of not having to pay electricity bills. The study found LCA and CBA as inappropriate for the purpose because their considerations exceed the boundary of house owner’s concern. These methods miss to capture investment in PV as a process from the status quo, i.e., using mains electricity from the grid. They do not account for the marginal benefits of associated actions such as using Energy Efficient equipment or making a house to be climatic responsive as shown in the PA case. Indifferent use of these gauges had resulted for economic misrepresentation of PV and consequently hinder public acceptance of such ‘green energy’. Key words: Investment Costs Benefits Photovoltaic and Green Energy INTRODUCTION investment mainly because the capital cost of such ‘Green energy’ is a casual term for renewable energy mains electricity supply from the national grid. This paper such as from wind power and solar power. The abundance assesses the economic sense of using PV to power the and perpetual nature of ‘green energy’ offers credible mechanical cooling requirement for a living/dining area in benefits to mankind and planet Earth. However, the reality two simulated detached houses of different designs; one of built environment requires ‘green energy’ to not only is designed with climate while the other is without claim technical benefits but also economic benefits for the consideration to the climate. The idea is to demonstrate stakeholders because that is a major element that the effect of using common economic tools such as influences the uptake of such endeavour [1]. A study has Return on Investment (ROI), Payback Period (PBP), Life shown that whilst the society claims to be concerned on Cycle Assessment (LCA), Life Cycle Cost (LCC) and the environment and aware of the technical benefits of Cost Benefit Analysis (CBA) that normally make or ‘green energy’, they are not willing to spend on it [2]. break projects. This study hopes to demonstrate the A popular ‘green energy’ scheme is photovoltaic inadequacies of these common economic gauges for (PV) system that generates electricity from solar power. assessing PV in domestic application. The PV cells are made of two thin silicon layers with different amount of impurities that generate electrical field METHODOLOGY when exposed to sunlight. An inverter in the system converts the direct electrical current from sunlight The methodology is divided into two stages. The first to be alternating current for household’s consumption stage involves computer simulation to ascertain the [3]. Unfortunately, PV is well-known as unfeasible indoor air temperature of the living/ding area. Whenever, system is relatively high compared to the alternative, i.e.,