## 4 Development of the Profit Rate of an ESS-Connected PV Analysis Method
### Proposal for the Policies  
The result of economic evaluation done above shows that, with the conventional evaluation method, the time that is required for an ROI was over 15 years and with the new evaluation method, the ROI period required was eight years. When the annual price reduction of PV systems and ESS is considered, the result showed some improvement; still, without continuous support of renewable energy policies from government, it appears to be difficult to secure economic feasibility. The current government's renewable energy support policies could be categorized into three cases: contract demand related discount; discount on renewable energy electricity; and, ESS exclusive plan.  
The simulation, wherein each case of the governmental support policies was applied at the target building in Ansan-city with combination of PV = 250 kW, ESS = 846 kWh, and PCS = 250 kW, was executed. The percentages assigned to each case were a 15.7% discount on renewable energy electricity, 39.7% on the ESS exclusive plan, and 3.6% as the contract demand related discount. The ESS exclusive plan had gone through some revisions, so that it could be initiated in April of 2016. The plan is now confirmed to be operational until March of 2026 and, since the price of the ESS is estimated to drop until 2026, it appears to be a reasonable period. On the other hand, a discount in the renewable energy electricity policy was initiated from May of 2017, but it is scheduled to end in late December of 2020.  
According to table below, the renewable energy electricity discount policy is making a great contribution in supplying renewable energy by consuming up to 15% of the total discount. The price of PV and ESS will each drop by 22% and 30% at most, which would lead to an improvement of ROI if the government decides to keep this policy up to year 2023.  
As for the ESS exclusive plan, the problem is with the limit that is set the ratio of maximum power demand to contract demand. The policy must be reconsidered to change the limit to 30%. This kind of regulation is implemented, because of KEPCO's power management policy for buildings. Most of buildings in Korea go through construction with excessive planning. In this process, the maximum power demand is set to be below 40% of the initially planned power demand. This causes difficulties in effectively utilizing ESS. Every time, the ratio drops by 10% from the existing 30%, the cost of an ESS exclusive plan rises by 15%, and this must be investigated and revised. It would be too difficult if policies for general buildings are covered. It seems appropriate to decrease the limit of the ratio,  
\begin{table}
\begin{tabular}{c c c c} \hline \hline
**Specifics**Case**Number & \multicolumn{3}{c}{**ROI [year]**} \\ \cline{2-4}  & **2** & **4** & **7** \\ \hline Case with PV + ESS & 8.62 & 9.32 & 12.77 \\ Case with ESS only & 7.12 & 6.96 & 7.28 \\ Reduction rate [\%] & 17.4 & 25.3 & 43.0 \\ Average reduction rate [\%] & & 28.6 & \\ \hline \hline \end{tabular}
\end{table}
Table 16: Economic evaluation when only ESS is installed.  
especially for buildings where the ESS tariff system has been deployed, from 30% to 20% within five years.  
Table 17 lists improvement plans for government policies on renewable energy based on this paper.