Installation Costs are costs associated with installing the system, and include equipment, labor, engineering, permitting, and any other costs that apply in Year 0 of the project cash flow. Some costs, such as debt-related and sales tax costs are specified on the Financial Parameters page.
SAM uses the variables on the Installation Costs page to calculate the project investment cost and annual operating costs reported in the project cash flow and used to calculate cost metrics.
Recurring costs that apply in Years 1 and later of the project cash flow are on the Operating Costs page.
Variable values in boxes with white backgrounds are values that you can edit. Boxes with blue backgrounds contain calculated values or values from other pages that SAM displays for your information.
SAM provides the categories under Direct Capital Costs and Indirect Capital Costs for your convenience to help keep track of project installation costs. Only the Total Installed Cost value affects the cash flow calculations, so you can assign capital costs to the different cost categories in whatever way makes sense for your analysis. For example, you could assign the cost of designing the array to the module cost category or to the engineering category with equivalent results. After you assign costs to the categories, you should verify that the total installed cost value is what you expect.
Notes.
The default cost values that appear when you create a file or case are intended to illustrate SAM's use. The cost data are meant to be realistic, but not to represent actual costs for a specific project. For more information and a list of online resources for cost data, see the technology pages on the SAM website.
The Installation Costs page only available for cases with a cash-flow-based financial model. It is not available with the No Financial Model option or the LCOE Calculator financial model.
Direct Capital Costs
A direct capital cost represents an expense for a specific piece of equipment or installation service that applies in year zero of the cash flow.
Note: Because SAM uses only the total installed cost value in cash flow calculations, how you distribute costs among the different direct capital cost categories does not affect the final results.
Collector cost, $/m2 or $/Unit or $/W
The cost of collectors in the system. You can either include labor costs for collector installation in the collector cost, or account for it separately using the installation cost category. The total collector cost is calculated as either:
•Dollars per square meter multiplied by collector area on the SWH System page, or
•Dollars per unit, representing the total collector cost, or
•Dollars per thermal watt of collector capacity multiplied by the nameplate capacity on the SWH System page.
Storage cost, $/m3 or $/Unit
The cost of the solar storage tanks. The total storage cost is either:
•Dollars per cubic meters multiplied by the storage volume on the SWH System page, or
•Dollars per unit, representing the total storage cost.
Balance of system, $
A fixed cost that can be used to account for costs not included in the collector and storage cost categories, for example, the mounting racks and piping.
Installation cost, $
A fixed cost that can be used to account for labor or other costs not included in the other cost categories.
Contingency, %
A percentage of the sum of the collector, storage, balance-of-system, and installation costs to account for expected uncertainties in direct cost estimates.
Total direct cost, $
The sum of collector, storage, balance-of-system, installation, and contingency costs.
Indirect Capital Costs
An indirect cost is typically one that cannot be identified with a specific piece of equipment or installation service.
Note: Because SAM uses only the total installed cost value in cash flow calculations, how you distribute costs among the different indirect capital cost categories does not affect the final results.
Engineer Procure Construct, % and $
Engineer-procure-construct costs, sometimes abbreviated as EPC costs, are costs associated with the design and construction of the project, which SAM calculates as the sum of a "non-fixed cost" and a fixed cost.
% of Direct Cost is a value that you type as a percentage of Total Direct Cost under Direct Capital Cost).
Non-fixed Cost is the product of % of Direct Cost and Total Direct Cost.
Fixed Cost is a value that you type as a fixed amount in dollars.
The total engineer-procure-construct cost is the sum of Non-fixed Cost and Fixed Cost.
Project Land Maintenance, % and $
Costs associated with land purchases, permitting, and other costs which SAM calculates as the sum of a "non-fixed cost" and a fixed cost.
SAM does not use the land area value shown on the solar field page for trough and tower systems in the land cost calculation.
% of Direct Cost is a value that you type as a percentage of Total Direct Cost (under Direct Capital Cost).
Non-fixed Cost is the product of % of Direct Cost and Total Direct Cost.
Fixed Cost is a value that you type as a fixed amount in dollars.
The total project-land-miscellaneous cost is the sum of Non-fixed Cost and Fixed Cost.
Total indirect cost, $
The sum of engineer-procure-construct costs, project-land-miscellaneous costs.
Sales tax
Sales tax of, %
The sales tax rate from the Financial Parameters page.
applies to, %
The sales tax basis as a percentage of the total direct cost.
SAM calculates the total sales tax amount by multiplying the sales tax rate from the Financial Parameters page by the sales tax basis on the Installation Costs page:
Total Sales Tax ($) = Sales Tax Rate (%) × Sales Tax Basis (%) × Total Direct Cost ($)
For an explanation of the effect of sales tax on income tax, see Sales Tax on the Financial Parameters topic for the financial model you are using (Residential, Commercial, Single Owner, etc.)
Total Installed Cost
The total installed cost is the sum of all of the direct and indirect capital costs and sales tax. SAM uses this value to calculate the project's net capital cost, which is the total installed cost less any cash incentives on the Incentives page and plus any additional financing costs from Financial Parameters page.
Total installed cost, $
The sum of total direct cost and total indirect cost.
Total installed cost per capacity
Total installed cost divided by the total system rated or nameplate capacity. This value is provided for reference only. SAM does not use it in cash flow calculations.
The units depend on the type of system: For photovoltaic systems: $/Wdc, for standalone battery systems: $/Wac, for other systems: $/kWac.
