A method to assess the potential market and economic feasibility of a renewable energy product: The solar air conditioning system case

The Solar Absorption Air Conditioning Systems (SAACS) represent an ideal and innovative technology to offset energy consumption in the Caribbean and maybe in a great portion of the world. SAACS, developed in Puerto Rico, is technically feasible for other places as long as those places have a similar climate to Puerto Rico. However, at this moment, the economic feasibility of the SAACS has not been demonstrated. This research studies the economic feasibility of the SAACS in Puerto Rico. In order to reach the commercialization phase, it is necessary to accomplish technical requirements, as well as, economic feasibility. The objectives of this research were the followings: (1) to provide a good estimate of the potential market and possible revenues for this technology, (2) to make a cost analysis of this innovative technology and to develop a cost template that aggregates the total product cost. This research will be used as a model to study the economic feasibility of the system in the Caribbean.;In terms of the market the most important conclusions of this research are: (1) there are potential customers willing to buy SAACS, (2) service and maintenance and a competitive selling price are key criteria in the decision to purchase the SAACS. In developing the new business to manufacture and distribute the new technology two key factors have to be considered: (1) it is crucial a joint venture between the private and the government sector that facilitates having a good market position in a very competitive industry and (2) the competitive selling price suggests that SAACS need continuous strategic cost management. This strategy should allow to the new company to fulfill customer's expectations and achieve competitive advantage.