Economic Resilience and Bankability of Utility-Scale Solar PV Projects under the Algerian Feed-in Tariff Framework

As Algeria accelerates its energy transition, assessing investment risks associated with macroeconomic and technical uncertainties is essential for the deployment of large-scale photovoltaic (PV) power plants. This study proposes a stochastic techno-economic framework to evaluate the financial viability and risk profile of grid-connected PV systems in Algeria over a 20-year operating period. Key uncertainties, including the Performance Ratio (PR), annual Degradation rate (Dg), Capital and Operating Expenditures (CAPEX/OPEX), Global Horizontal Irradiance (GHI), Inflation, and Discount rates (Infrate /Disrate), are propagated through an integrated risk model. The cash-flow analysis is aligned with the Algerian regulatory framework, with project revenues estimated using the national Feed-in Tariff (FiT) mechanism, which varies according to plant size and annual productivity. Eight economic indicators are assessed: Levelized Cost Of Energy (LCOE), Net Present Value (NPV), internal rate of return (IRR), Simple and Discounted Payback Periods (SPP/DPP), Net Profit (NetP), Return On Investment (ROI), and Benefit-Cost Ratio (BCR). Results demonstrate the strong economic resilience of PV investments. The probability of achieving an LCOE below the minimum FiT reaches 70%, confirming the competitiveness of PV electricity relative to conventional generation. Moreover, the probability of obtaining a positive NPV exceeds 96.8%, indicating a high level of investment attractiveness and bankability. While SPP remains relatively stable, DPP shows greater variability due to its sensitivity to inflation and discount rates. These findings provide valuable probabilistic insights for policymakers and investors to support risk mitigation and optimize renewable energy investments in Algeria and North Africa.