Sunday, April 8, 2012

The influence of the Utilization Factor on micro-grids

The combination of Output Based Aids (OBA) and a stable regulatory framework is the most powerful tool to boost the deployment of renewable energy projects. The positive impact of the application of feed-in-tariff based programs in some European countries (i.e. Germany, Italy,etc.) during last years and, most recently, the takeoff of the Indian and South African markets endorse this statement.

But OBA mechanisms are not only valid to stimulate the connection of renewable energy based generation capacity to the existing grid. As presented previously (1), this financing instrument can be also adjusted for the off-grid market and thus, incorporate this kind of applications as part of the energy mix, specially in the less developed world.

In fact, taking a look at this map, it can be observed that the lack of distribution and transmission infrastructures in large areas of sub-Saharan Africa suggest that renewable energy based decentralized solutions, and specially micro-grids, should play an important role when planning the growth of the electrical systems in the coming future.

OBA models for micro-grids, when working in off-grid mode, are usually supported by a Regulated Purchase Tariff that would complement the cost of every kWh generated by the micro-grid that has not been covered by the end-user. Therefore, every micro-utility operator would recover his investment through a monthly fee consisting of:

Incomesmicro-grid = €user + RPT, where:

RPT = fixed value determined by the national/regional regulatory authority
user = is a variable value and depends on the energy demanded/purchased by the end-users
And this is the main difference compared to the OBA schemes applied for grid-connected systems. The Utilization Factor, that is to say, the relation between the total energy available and the energy demanded by the users, plays a determining role when forecasting which will be the incomes for a micro-grid operator in a specific period.
How the UF can be improved?
A micro-grid performing in isolated mode is not too different to the way that the national grid works, and faces the same problems, that is, to forecast the demand and sell as much energy as possible with a fixed installed capacity. Some approaches to ease the influence of the UF may be:
  1. Overbooking: connect as many users as possible bearing in mind that if all them decide to consume the maximun energy allowed (let's say 200 Wh/ customer) at the same time, the system would collapse. But this does not frequently occurs, so one can decide to take the risk. However, as the cost of the distribution network may have an important weight into the total cost structure of the micro-grid, it is needed to keep a balance between the costs of the system and the need to ensure a high UF.
  2. Demand side management: along with the above, another good approach is to implement strategies to stimulate the demand when there is an excess of energy (e.g. it is noon and the battery is fully charged) This can be done offering this surplus of energy at a lower price, for example. There are several solutions in the market that allow to apply this type of measures. For example, the Electricity Dispensers developed by the company Trama Tecnoambiental send an alert to the user through a flashing LED when the "low-cost consumption period" is available. Of course, it is also needed to enhance the sensitivity of the user on the energy efficiency.
But maybe the most interesting approach is to combine different types of users within the micro-grid. In the figure below it can be observed that the consumption of individual users can be really difficult to predict,  in terms of the maximum power demanded at a specific time of the day. But the good news is that after an initial observation of their behavior during the first weeks of operation, at least it can be identified that when it takes place the most of the cosumption (from 6 p.m in this case)

Now let’s think of another type of loads, those that can be powered just a few hours per day (o per week), exactly when there is a surplus of energy.  These are the “back-up loads”, for example: a water pump or an ice-making machine.
And finally, bigger customers with a higher and more predictable demand, as schools, health centers or, (that would be perfect) a mobile phone antenna.

In this last category we could also include the so called "Community centers". Several initiatives have been developed in the last year, as previously discussed here (2) It basically consist of a building that houses facilities for providing a wide range of services, such as IT services (internet access, printing, photocopying, etc.), entertainment (TV, video...), sell of electricity (mobile or laptop charging, e..g) or any other activity that requires of electricity. This community centers may become a perfect complement for the "mix of users" needed for making the micro-grid as profitable as possible while providing access to the energy in a more democratic way, even for those that can not afford a connection for their own homes.
So we can agree that one of the main challenges when talking of micro-grids in isolated areas is how to make them as dynamic and flexible as possible in order to provide access to the energy to the greatest number of people while ensuring the profitability of the promotor/operator. And the latter means selling as much electricity as possible!

Additional resources:

(1) Mini-grids, feed-in-tariff and grid parity

(2) Solar PV powered energy kiosks

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