8.1 A RATIONAL Model FOR COST PERFORMANCE OPTIMIZATION
One very important aspect of designing any kind of solar system has to do with rational evaluation of cost and performance trade-offs (O’Gallagher and Winston, 2003). Often, when evaluating such concepts, a major emphasis is placed on developing a quantitative understanding of the technical performance, perhaps optimizing some standardized parameter related to conversion efficiency, such as optical quality and thermal absorption without regard for the related costs. However, although economic motivations are clearly present in considering these approaches, there is a tendency to be much less quantitative in attaining an understanding of the cost trade-offs involved in optimizing the system. Often, performance goals that are unattainable in practical economic systems are set and then used to design other parts of the system.
As has been previously noted (O’Gallagher, 1994), this practice of maximizing the efficiency with respect to some design parameter may not yield the most cost-effective configuration: That is, designs that allow the use of inexpensive materials and construction techniques may not (and probably will not) approach the performance of the most efficient systems one could build. Similarly, designs that attain the highest technically achievable efficiencies may not (and probably will not) be cost-effective. Despite the self-evident nature of these statements, one common approach has been simply to determine those parameter values required for maximum or near-maximum efficiency and select the corresponding designs as baseline or reference configurations. This practice unfortunately often results in selecting a development path, which leads away from the ultimate goal of minimizing the cost of delivered energy.
Here we consider a new methodology for the rational optimization of performance versus cost based on the constraint that, at the optimum, the relative incremental performance gains with respect to a particular performance parameter should balance the incremental costs associated with improvements in that parameter. We developed this methodology in the particular context of concentrating dish-thermal systems; however, the conclusions quantify some commonsensical relationships that should be applicable to many renewable energy systems. In this section, we present the elements of this model and discuss some of its implications.