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Energy Return on Energy Invested

(EROI) and Energy Payback Time

(EPBT) for PVs

Ajay Gupta
EROI ENERGY ADVISORS INC., BRAMPTON, ON, CANADA
akg78002@me.com

21.1 Introduction

Energy return on investment (EROI) or as it sometimes called, energy return on energy
invested (ERoEI), is a tool for analyzing and comparing different types of fuels. EROI refers
to the ratio of the usable energy returned during a systems lifetime, to all the invested en
ergy needed to make this energy usable. It is related to net energy analysis (NEA), which
calculates energy output minus energy inputs of a system, and also to life cycle analysis
(LCA), which describes the total energy inputs for a system. As EROI is a ratio, it is a prop
erty without units. For example, EROI can be calculated using joules per joules or barrels
of oil output per barrels of energy equivalent input. As such, EROI analysis has certain ad
vantages over other tools when comparing different fuels and their impact on organisms
or society.
Dale et al. [1] offer a short list of historic conceptualizations of EROI before it was popu
larized by systems ecologist Charles Hall. It was Hall who first coined the term “Energy
Return on Investment” in the 1970s with a focus on migrating fish [2], and during the
1980s, along with others, expanded the concept to energy sources fuelling the US econ
omy, such as oil [3]. The concept of comparing energy outputs with inputs, expressed as
“net energy” has been in the anthropological [4], economic [5,6], and ecological [7] litera
ture for sometime; however, EROI offers some additional insight into fuels. EROI analy
sis can be applied to the fuel of a variety of systems, including biological organisms. Hall
argues that it can even be the “master driver” of evolution, as energy can be viewed as
the master resource for evolution and EROI the means of obtaining Darwinian fitness [8].
Although it is a physical concept, EROI analysis can also have economic implications in
terms of rates of growth [9], finance, and the economics of fuels [10]. The higher the EROI
of a fuel technology, the more valuable it is in terms of producing an economically useful
energy output [11]. A higher EROI allows more net energy to be available to the economy;
and all economic activity relies, to some degree, on energy use.

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