Sunday, December 4, 2011

Choosing the least-cost option

Figure 1: Example of decision tree for least-cost technology choice (AFREA)

Then main part of the preliminary assessment that should be conducted at an early stage of the development of a rural electrification project (see also this post) is to determine which is the least-cost solution, comparing life-cycle costs (LCC) per kilowatt hour (kWh) of the system/s under evaluation (PV stand alone, wind-PV hybrid mini-grid,etc) against traditional solutions, that is, grid extension and diesel generators. For this purpose, standard cost curves are an useful tool.

Previously, the following information should have been gathered and evaluated:
  •  Estimated daily energy demand: which, where and how many facilities and services to cover
  • Availabity of renewable energy resources: solar, wind, water,etc
  • Diesel-fuel affordability and reliability of supply
  • Grid extension plans and distance from the national grid
  • Estimated system sizes
  • Estimated system costs
  • Estimated system operating cost

As said above, for a preliminary LCC assessment, standard cost curves and rough data may be valid, although it is highly recommended to try to obtain updated information according to local parameters and market state of the art. Figure 2 shows a comparison between typical arrangenments for rural electrification, that is: PV stand-alone, PV-diesel hybrid system, diesel generator and grid extension. Two distances are considered for the option "grid extension", since distance to the facilities to be powered is a determining factor that must be considered.

Figure 2 (AFREA)
After a LCC analysis as above, some interesting conclusions can be obtained, such as:
  • Low energy demands favor solutions based on PV technology (stand-alone or hybrid) This is usually true from 3,5-4 kWh/m2/day of solar radiation.
  • From 3 kWh/day of energy demand, PV-diesel is not longer cost-effective against grid extension (if the national grid is in a radius of 1 km or less)
  • From 20 kWh/day, PV is not longer competitive with diesel generators
  • From 30 kWh/day, grid extension is the least-cost option

Usually the information needed for a good LCC assessment is not available at early stages of project development. Figure 3 shows the differences in grid extension costs depending on the project location. Also operating costs are not always easy to predict. As a rule of the thumb, these are usually estimated as a fixed proportion of investment costs. For example, PV operating costs may be estimated at about 15% of the capital costs for stand-alone systems (that is, 50% of the total life cycle costs)

Figure 3: Costs of grid extension in US$/km (ESMAP,2000)

Likewise, operating costs also depends on the ownership structure, distance to the closest service center, system sizing and design, fuel prices, etc. For exmple, depending on the type of batteries chosen these may last up to 8-10 years or need to be replaced every three years. Something similar happens with diesel generators. The durability of a generator is limited by the number of operating hours and also linked to the load curve at which the generator is usually operating.

According to the above, a proper LCC analysis should incorporate as many variables and potential scenenarios as possible. In this regard, the use of energy modelling software like HOMER is strongly recommended in order to limit and discard options and ultimately decide what is the least cost option for a SPECIFIC project. For example, once evaluated capital and operating costs for several options, HOMER can provide a graph as this below:

This graph aims to compare different arrangements (PV and wind stand-alone, PV and/or wind diesel hybrid system ,only diesel generator,etc.) and provides this information:

  1. Diesel generator is not a cost-effective option in any case, even when fuel price is 0.4 $/L.
  2. PV systems are the least cost option as long as average solar irradiation is higher than 4.0 kWh/m2/day and average wind speed is lower than 5.0 m/s.
  3. Wind energy is always the most cost-effective option when average wind speed is higher than 6.0 m/s.
So even if the renewable energy resource has been not evaluated yet (wind resource is especially hard to assess) or there is uncertainty about diesel prices, these kind of software enable the project developer to further progress over the decision tree.

Author's observations (Rwanda Electrification Challenge, 2009)
Green light for renewable energy in developing coutries (ARE, 2009)
Guidance for Sustainability (AFREA)

Saturday, November 26, 2011

Solar PV powered energy kiosks

Solar powered energy kiosks are the latest and most innovative example of how renewable energy based off-grid systems are a powerful tool for creating employment through self- sustainable business centers and small enterprises.

Thanks to renewable energy, these ICT centers can offer a wide range of services, such as:
  • Office applications (printing, scanning...), email and internet access.
  • Mobile and solar lattern recharging.
  • Community learning and entertainment center (e.g.watching a movie or a football match)
  • Hair cutting and clipping salon.
  • Soap making facility for local women.
  • Milling facility.
Additionally, value added services can be also provided, being education the most important in this category through the organization of workshops and training courses (computer fundamentals, welding workshop,etc)

The Ducht company Nice International is a pioneer in the development of sustainable ICT services centers in Sub-Saharan Africa. These NICE-centers are operated by local entrepreneurs on a franchise basis.

Another good example can be found in Kenya, where Dr. Izael Pereira, in cooperation with the UNIDO Kenya Renewable Energy Program has completed the implementation of a pilot project of an ICT kiosk powered by a 5 kW hybrid wind-solar system. It is interesting to highlight that this project incorporates an additional approach. That is, the mini-grid also provides electricity for external loads, such as a hospital, a school and a few households. Below can be found a chart with the distribution of loads:

This approach allows to introduce the concept of backup loads. It is observed in the chart that 50% of the mini-grid capacity serves the ICT loads (main load), while the other 50% powers the rest of consumers. In practice, this configuration may enhance the energy efficiency of the system since allows to make use of the energy surplus inherent to every off-grid system. Through the application of energy management techniques, like pre-paid meters linked to the charge status of the batteries, the daily load profile may become more homogeneous.

All the above results in a increase of the incomes and thus the profitability of the project, allowing this business model to be self-sustainable.

6 months income generation

In brief, these solar kiosks can provide substantial benefits to the local communities, stimulating the creation of small enterprises and providing services to the local communities that improves their living conditions (like access to the information, education and entertainment)

Rural Electrification Sustainable Projects

Once the concept of long-term sustainability  has been presented, it seems reasonable to make a brief introduction of the main principles that should be considered from early stages of project development  to make a rural electrification project sustainable.                                
Lack of coordination among stakeholders has been always a hurdle, not only in terms of International Development projects. The chart above describes the different relations among main actors involved in a rural electrification project. Attention must be paid to the fact that frequently more than one role falls on the same entity or group. For example, depending on the ownership structure implemented, the "user" and the "owner" may be the same, that is, the community itself. Also it is usual that the "operator" and the "maintenance contractor" coincide in the same company or group, when the operation model is based on ESCOs or the beneficiary community is the owner of the system and they are in charge of the O&M tasks (only recommended for small scale projects with previous training for the users)

Apart from this, other typical errors during project development phase are:
  •  Wrong identification of community needs (or lack thereof)
  •  Selection of technology not based on an exhaustive Life Cycle Cost analysis
  •  Not incorporate inputs from beneficiaries that may affect the decision-making (e.g. costumes,  organizational issues,  etc.)
As introduced before, a sustainable approach should address bot technical and institutional arrangements, including an operation model that guarantees the success of the post-project period. In this regard, this process would consist of four main phases:

  1. Preliminary assessment: Identification of needs, determination of energy requirements, LCC analysis to determine the least-cost option, system sizing and estimated budget. Organizational and cultural issues may be incorporated at this stage.
  2. Implementation plan: gather information (grid extension plans, local institutional and market capacity, etc.); refine energy requirements, costs and system design; definition of ownership structure, business operation model; financing; preparation of technical specifications and terms of reference for capacity building...
  3. Procurement and contract management: securing firm financing commitments; developing tender packages and viable strategy for equipment procurement; logistic arrangements; contracts management; guarantees and warranties; construction, commissioning and handover...
  4. Long-term operation: contracted or in-house maintenance? post-project operational financing, beneficiary contributions, elaboration of O&M plan and tracking...

The above topics will be developed soon in specific posts.

IEC 62257-3 - Project development and management.

Thursday, November 24, 2011

IEC-62257 series Recommendations for small renewable energy and hybrid systems for rural electrification.

The purpose of this IEC series is to provide suitable tools for management of rural electrification projects as well as:
  • Make easier the work of project developers
  • Enhance the quality of the systems and the service provided.
  • Improve the safety of the systems.
In general, this series of technical specifications is really useful as introduction to the rural electrification and aims to become a guide of reference for project management and implementation but also provide basic technical specifications for components and systems.

IEC 62257 series is composed of 30 technical specifications, but some of them are still under development. Below you can find the 18 specifications published so far:

Part 1: General introduction to rural electrification
Part 2: From requirements to a range of electrification systems 
Part 3. Project development and management
Part 4: System selection and design
Part 5: Protection against electrical hazards
Part 6. Acceptance, operation, maintenance and replacement 
Part 7: Generators
Part 7.1: Photovoltaic generators
Part 7.3: Selection of generator sets for rural electrification systems
Part 8.1: Selection of batteries and battery management systems for stand-alone electrification systems
Part 9.1: Micropower systems 
Part 9.2: Microgrids
Part 9.3: Integrated system - User interface
Part 9.4: Integrated system - User installation
Part 9.5: Selection of portable PV lanterns for rural electrification projects
Part 9.6: Selection of Photovoltaic Individual Electrification Systems (PV-IES)
Part 12.1: Selection of self-ballasted lamps (CFL) for rural electrification systems and recommendations for household lighting equipment.

For additional information and downloads: IEC 62257 series webstore

Long-term SUSTAINABILITY in rural electrification projects

Since long-term sustainability is the main thread of rural electrification programmes, and so of this blog as well, first thing needed is a clear and precise definition of its meaning.

In this context, long-term sustainability will be defined as "the reliable and cost-effective operation of a system over its design lifetime" (AFREA, Africa Renewable Energy Access Program)

Although this blog is mainly focus on  Renewable Energy based projects, "systems" may also means any other kind of  solution such as connection to the utility grid or diesel generators. Nonetheless, for facilities in remote areas where the grid is not accessible (either due to technical or political reasons) and diesel generators are not feasible because of high price of the fuel or logistics, renewables, and mainly PV systems, usually is the most practical approach and also the least-cost option.

But the sad reality is that many of these systems become inoperative after a few years, and sometimes even from the first one. I have been able to see it by myself in my trip to Mali last December. Traditionally, these failures have been attributed to technical reasons, let's say lack of maturity of the PV technology. And as a result, the perception that beneficiary communities have about PV off-grid systems is erroneous. When I have tried to introduce the benefits of PV systems in some sensitization meetings in East Africa, usually the attendees have complained about "solar" as they still perceive it as a "low-cost" (low quality) option...

Obviously, technical problems arise during the operation of an off-grid system (even if PV is the renewable energy technology with less requirements in this regard), but the real problem that hinder the sustainable long-term operation of these systems is the lack of organizational and operational arrangements for the post-project period that must be formulated during the project development phase. That is to say, find answers to these questions:

  • Who/whom will be the owners of the installation? The community? a local utility? the local  government?
  • Who is in charge of the O&M? a private company? the community itself? Have they been properly trained?
  • How to fund maintenance costs? Repairs, components replacement, preventive maintenance, spare parts...
The above lead in turn to other questions that must be also answered, depending on the financial scheme and operation business model selected. These subjects will be further developed in specific posts.

Summarizing, strong and robust institutional arrangements must be done from project conception to avoid that common technical problems arising in any power system may lead the project/program to failure, and thus wasting funds that are usually really complicated to achieve.

Modern Lighting for Africa's Development

"This video, Modern Lighting for Africa's Development, shows how un-electrified low income households and small businesses in rural Kenya have switched from kerosene lamps to portable solar lanterns, and what benefits clean, modern off-grid lighting has brought them. It is intended for development partners.

The video includes footage of Lighting Africa's consumer education campaign in Kenya, which focuses on solar portable lanterns. Lighting Africa, a joint IFC and World Bank program, is mobilizing the private sector to build commercial markets for a range of modern off-grid lighting products. The program works with manufacturers, distributors, microfinance institutions, and consumers to make these products accessible to Africa's un-electrified communities."

Monday, November 21, 2011

A matter of facts

Thus we see the Earth at night. Lights delimit more developed and highly populated areas from the rest. The central part of South America, Asia, Africa and Australia "highlight" as the darkest areas.

Some quick facts for a better understanding:

Each day, NY city consumes the same amount of electricity as all Sub-Saharian countries combined excluding South Africa. In other words, these means that the almost 20 million inhabitants of NY consume in a year the same as almost 800 million people of Sub-Saharian countries, that is, about 40 TWh. It is obviuos to say that Africa has the lowest per capita energy use of any continent.

In 11 contries in Africa, more than 90% of people live completely without electricity. That means about 600 million people throughout the continent.

These 600 million are part of the 1.5 billion people worldwide without access to electricity (about 25% of the global population)

85% of these people live in rural areas.

Without additional dedicated policies, by 2030 the number of people without access to electricity is estimated to drop, but only to 1.2 billion. That would mean that still 15% of world's population would lack access to electricity

Source: World Energy Outlook 2010

Saturday, November 19, 2011

The quest to power Africa

A quite illustrative image of how is the relation between electricity generation and population around the world:

"In terms of population and land mass, Africa is the second largest continent in the world, trailing only Asia. But, amazingly, a majority of the billion people living on the continent survive every day with little to no access to electricity. In the midst of economic, social, and geopolitical turmoil, many of the poorest nations in Africa are unable to scrounge up the money, resources, and general know-how to bring electricity to their people."