Resumen
This paper presents a policy benefit model of a photovoltaic (PV) power generation project based on real options analysis (ROA) and the two-factor learning curve model. The main purpose is to examine the investment behavior of developing a PV project in the Gobi desert considering multiple uncertain factors. We take the environmental cost of desertification control into account for the first time in the literature. Four other uncertain factors are thermal power cost, PV power generation cost, carbon prices, and government subsidy. A binary tree method is applied to solve the proposed model, and we obtain both unit decision value and optimal investment time. Our baseline scenario illustrates that ROA is more effective than net present value (NPV) analysis when dealing with uncertainty. Our simulation results show that the government could suffer a loss in accordance with the existing subsidy policy when investing in a PV project. Therefore, the subsidy should be gradually reduced. Finally, the influence of the subsidy policy on decision value is discussed, and an appropriate subsidy is determined accordingly.