Mini grid and Solar home system

1. Solar PV andMini Grids

May 3rd 2011

Seminar Rural Energy Supply

Postgraduate Programme

Renewable Energy (PPRE)

Anita, Corinna, Dirk,

Esther, Rangini, Tuong

Motivation and problem

Introduction to solar powered mini-grid and SHS

Solar Home System (SHS)

3.1 technical aspects

3.2 economic aspects

3.3 social and environmental aspects

Case Study

Conclusion and outlook

Source:http://www.mhi.co.jp/en/earth/issue/history/future/renewable/solar.html

Rural areas with no electricity,grid connection might not be suitable

Necessity of low cost energy supply

Different sources of energy-> solar PV might be a solution

1. Motivation and problem

2. Introduction to solar powered Mini-grid and SHS

3. Solar Home System (SHS)

4. Case Study

5. Conclusion and outlook

2. Introduction to solar powered mini-grid and SHS

4. Case Study

Basic aspects

Necessity of easy operation

DC system and appliances

Different systems available

Size of system(PV module/battery) depends on specificlocal conditions:

Solar radiation, site conditions

Electricity service expectations (appliances/loads)

Energy expenditure patterns

General socio-economic situation

Before installation:

Training of users

Information about prices, product performance

Communication about necessity of maintenance

Explanation of PV technology and operation

Training of skilled technicians and access to sites

After installation:

Regular maintenance

of key components

Performance checks

Cleaning of PV modules

Water additions in batteries

Corrosion control

Replacement of broken elements

Guaranteeing access to well-functioning SHS

Quality and compatibility of components

Easy replacement

of components

Local entrepreneurs,

technicians,

manufactures

2. Introduction to solar powered Mini-grid and SHS

4. Case Study

Calculate electricity price per kWh generated by a SHS

annual costs/ annual electricity generation

Annualized-Life-Cycle-Costs (ALCC)

all initial and future costs are calculated over the operational lifetime of a system

total investment costs converted into uniform annual costs

Capital Recovery Factor (CRF)

accounts for the cost of financing a project (interest)

formula: i (1+i) n/ [(1+i) n-1]

i=discount rate, n=lifetime

annuities = individual payments * CRF

Levelized Unit Cost Of Electricity (LUCE)

W p= peak Watt capacity of PV module

EHFS = Equivalent Hour of Full Sunshine

CUF = Capacity Utilization Factor

In general:Cost reductions ($/kWh) as sizes and volumes of PV modules and batteries increase

cost-advantage of mini-grid

But: Costs for mini-grid depend on:

Length of total distribution line

Number + spatial distribution of households connected via mini-grid

Geographical factors

may offset cost-advantage!

PV supplier distributes PV systems directly or through a dealer network to the end-users, who pay in cash

minimal number of stakeholders

low transaction costs

high flexibility in consumer choice

limited market as a result of the high up-front investment needed

incentive to buy under-sized systems and cheap replacement components to save money

installation and maintenance/ after-sales service are problematic

main barrier of the high initial investment is lowered

investment costs are spread over a number of years

Dealer credit

one institution handles both the financial and the technical work

high rural credit risk

ability and willingness torepay the credit often limited

dealer cash-flow often as constraint

high interest rates due to expensive capital through dealer re-finance

End-user credit

PV company avoids financial risks and can concentrate on sales and after-sales services

credit institutions are much better equipped to manage a credit scheme

market is restricted to customers that the credit institution deems creditworthy

high interest rates and down-payments

geographically restricted because of the infrastructure needed for the collection of the payments and possible retrieval of the collateral

low initial costs for end-user

potential for cost reductionthrough economies of scale

rapid deployment

user less involved/ feel less responsible

mostly limited to the hardware

spreading of costs for the user over a long period

cost reductions due to economies of scale

maintenance can be kept at a high standard because of the professional care for the system

good-quality products are selected because of the long repayment period

End-users may not treat the systems with care, as initially the maintenance and ownership do not lie with them

geographically restrictive (extensive infrastructure needed for the collection of the payments and the maintenance and repair of the systems)

end-user does not have to invest in a solar system (only connection fee)

maintenance and repair are organized centrallylower costs + high quality maintenance

high-quality systems, components and installation are encouraged because of the inevitable long-term agreements

proper collection and recycling of components (e.g. batteries) is possible

high risks and high transaction costs result in high monthly fees and reduce affordability for poor households

end-user is not the owner of the systemmay not treat the system as carefully

client is usually not allowed to miss a monthly payment

4. Case Study

Increase in comfort

Additional income/saving costs

Education and employment

Health and security

Prevent rural-urban migration

Knowledge

Peoples expectations

Cultural barriers

"Solar energy is very important, it is not that expensive and can last very long, 100 years.

One SHS can create enough energy to power a computer, copy machine, lights in every room, television, and appliances, all from a pretty small device."

(Sovacool et. al. 2011: 8)

Knowledge

Peoples expectations

Cultural barriers

Savings of C0 2

Displacing dry cell batteries

Little space consumption

Recycling systems for lead-acid batteries required

Resource exploitation and energy consumption for production, transport and recycling

By-products and toxic components

4. Case Study

Energy service provider and social enterprise in Bangalore

Started in 1995 byHarish Handean Energy Engineer

Today: 170 employees, 25 energy service centers

Products: Solar lighting, Solar thermal, Cookstoves

To sell and service SHS in rural areas of India that lack access to electricity

Making affordable through financial instruments such as bank loans and micro finance credits

Won two times the ASHDEN awards

(Green Oscar) in 2005 and 2007

Installed 115,000 solar home systems in 15 year

75 local entrepreneurs created

Two-thirds of its customers surviving on less than $3-4 per day

4. After sales services

1. Door to door s services

2. Financial schemes

SHS are a good option for rural electrification

Encouragement of private local entrepreneurs needed

Good financial instruments needed

Necessity to carefully consider local conditions and customers needs prior to taking action

Necessity to think furtherproduction and maintenance infrastructure needed

Inequity in energy supply between rural and urban population remains

Mini Grid Design Manual, Allen R. Inversin, International Programs, National Rural Electric Cooperative Association

http:// www.sma.de/en/news-information/videos-animations/videos-animations-sunny-island.html ( video on solar PV mini grid system by SMA )

A techno-economic comparison of rural electrification based on solar home systems and PV micro grids A. Chaurey a,1, T.C.Kandpal b, Energy Policy.

Nieuwenhout, F.D.J. et al, 2001: Experience with Solar Home Systems in Developing Countries: A Review. Progress in Photovoltais: Research and Applications 9: 455 474.

Van der Vleuten, F. et al., 2007: Putting Solar Home System Programmes into Perspective: What lessons are relevant?Energy Policy 35: 1439 1451.

Allicance Soleil SARL, ETC International Group, 2009: Training Manual for Domestic Solar Electricity Trainers

www.energypedia.info

Worldbank:http://data.worldbank.org/indicator/FR.INR.LEND

Anisuzzaman, M.; Urmee, T.P. . Financing Mechanisms of Solar Home Systems for Rural Electrification in Developing Countries:http://www.aseanenergy.info/Abstract/32010680.pdf

Chaurey, A.; Kandpal, T.C. ,2010. A techno-economic comparison of rural electrification based on solar home systems and PV microgrids. Energy Policy 38. 3118-3129

Scheutzlich, T.; Klinghammer, W.; Scholand, M.; Wisniwski, S.; Pertz, K., 2001. Financing of solar home systems in developing countries. Volume I: Main Report. Environmental Management, Water, Energy, Transport Division 44 GTZ

Baldwin, G., Childs, B., Hunter, C., Urrea V. 2007: Developing a Strategy to Improve Solar Home System Sustainability in Rural Thailand. Worcester Polytechnic Institute:http://www.wpi.edu/Pubs/E-project/Available/E-project-030107-003542/unrestricted/SOLAR_Final_Report.pdf25.04.2011

Barua, D. C., Urmee, T. P., Kumar S., Bhattacharya S. C. 2001:A Photovoltaic Solar Home System Dissemination Model In: Progress In: Photovoltaics: Research And Applications 9: 313-322

Kaufman S., 1999: Rural Electrification with Solar Energy as a Climate Protection Strategy.http://www.repp.org/repp_pubs/articles/resRpt09/index.htm25.04.2011

Khan, H. J., Hugue, A. J., Andaleeb, S. S. : The Solar Home System: An Alternative Energy Source For Rural Households in Bangladesh:http://www.bdiusa.org/Publications/JBS/Volumes/Volume3/jbs3.2-3.pdf25.04.2011

Posorski R., BussmannM., Menke, C. 2003: Does the use of Solar Home Systems (SHS) contribute to climate protection? In: Renewable Energy 28 (2003) 1061-1080.

Sovacool B. K., DAgostino A. L., Bambawale M. J. 2011: The socio-technical barriers to Solar Home Systems (SHS) in Papua New Guinea: Choosing pigs, prostitutes, and poker chips over panels. In: Energy Policy 39 (2011) 15321542.

http://www.selco-india.com/

http://nexus.som.yale.edu/design-selco/ ( video for solar entrepreneur )

http://www.ashdenawards.org/winners/selco07 http://money.cnn.com/magazines/business2/business2_archive/2006/12/01/8394996/index.html

Technology

Mini grid and Solar home system