Can synergies in agriculture through an integration of solar energy reduce the cost of agrivoltaics? An economic analysis in apple farming

Agrivoltaics is a relatively new concept of agriculture and photovoltaic power generation on the same area. While an increased land use efficiency and potential synergies between agriculture and power generation speak in favor of agrivoltaics, higher investment cost compared to ground-mounted  photovoltaics represents a challenge for a broader market launch in most countries. This work analyses the economic performance of agrivoltaics in apple farming focusing on potential synergies and adverse effects regarding investment requirements and operational cost of the farming system. The analysis is based on literature, expert interviews, and data of three pilot projects in Germany. The results show that average investment cost from the farming system could be reduced by 26% mainly due to partially replacing the hail protection structure. Annual operating costs of the farming system reduce by up to 9% through lower cost for land and maintenance works. However, annual revenues also decrease by about 9% due to an expected reduction in high quality apple yield. Overall, the cost of apple production decreases by about 5%. Regarding the total cost of agrivoltaics, though, the potential contribution from cost savings in the farming sector to reduce the cost of electricity only amounts to <1%. The expected Land Equivalent Ratio of the analyzed agrivoltaic system amounts to 1.54. The results indicate that agrivoltaics in orcharding is only economically feasible if the regulatory framework provides sufficiently high feed-in tariffs or comparable support payments. The work also shows that the theoretical potential of agrivoltaics in apple farming in Germany amounts to 23.8 GWp which could contribute to 13% of the PV development required to meet Germany's climate goals by 2030 [1].