The purposes of this study were to develop a multi-criteria approach based on Geographic Information Systems (GIS), Light Detection and Ranging (LIDAR) and hourly horizontal radiation data to explore the possibility of installing photovoltaic (PV) systems in urban environments, and to evaluate the resulting annual production of electricity. This new model was tested on a small area in the municipality of Miraflores de la Sierra (Spain). LIDAR data provide an accurate description of urban environments by creating a Digital Surface Model (DSM), which is used to calculate the local inclination and orientation of roofs by means of the shadow effect of the various components (including other buildings and trees). In this study, we present the possibility of differentiating two roof types: in the first, the PV panels are placed parallel to the roof, and in the second, structures are employed to mount them in the optimum position. Self-shading is taken into account in the second case. The radiation incident on the panels is calculated with a geometric method based on the hourly horizontal radiation broken down into its diffuse and direct components. Finally, the efficiency of the panels and different sources of losses, especially temperature, are incorporated into the assessment of the effective production. The five most common panel technologies are considered.