The denominator is based on standard test conditions. Check the link for details. http://sinovoltaics.com/learning-center/quality/standard-test-conditions-stc-

The denominator is based on standard test conditions. Check the link for details. http://sinovoltaics.com/learning-center/quality/standard-test-conditions-stc-definition-and-problems/ http://sinovoltaics.com/learning-center/quality/standard-tes... Those conditions reflect not the theoretical maximum but an expected output in very good actual conditions. This is relevant because it relates to the needed transmission capacity one need installed. For instance, at 30% capacity factor, you're "wasting 70%" of transmission on average. It's a good metric to compare between sites of a same energy source but it's not very useful between sources. For that, the better metric is Levelized Cost of Energy (LCOE) in $/MWh. Usually present with or without subsidies.