Economic Feasibility of Solar Energy Usage in Residential Building in Malaysia

Abstract: The increasing demand for sustainable energy solutions has led to the adoption of solar photovoltaic (PV) systems in residential buildings. However, concerns regarding the economic feasibility of such systems remain a critical barrier to widespread adoption. This study aims to evaluate the cost-effectiveness of residential solar PV systems by analyzing key financial indicators, including payback period, net present value (NPV), internal rate of return (IRR), and levelized cost of energy (LCOE). The methodology employed in this research is a case study approach, examining real-world residential solar PV installations to assess economic feasibility. Findings indicate that while reduction installation costs and financial incentives enhance the viability of solar PV systems, challenges such as high upfront costs and regional policy disparities still exist. Future research should explore innovative financing mechanisms and advancements in storage technology to further improve economic feasibility and adoption rates.