the economics of wind-diesel microgrids

The Economics of Wind-Diesel

Microgrids

www.homerenergy.com 2334 Broadway, Ste. B, Boulder, Co. 80302

Peter Lilienthal2011 International Wind-Diesel Workshop

Girdwood, AlaskaMarch 10, 2011

http://www.homerenergy.com/

The Future of PowerClean, distributed power with hybrid

renewables and smart micro-grids

2334 Broadway, Ste. B, Boulder, Co. 80302

Clean Power Evolution

• Large utilities– Security obstacles – Regulatory obstacles

• Smaller systems– Liquid fuels from oil– High renewable penetrations

Micro-grids with distributed controls for reliability and efficiency


Too Many ChoicesSolar

Wind

Biomass

Hydro

Geothermal

Micro-turbines

Fuel Cells

New Storage Techs.

Electric

Vehicles

Demand ResponseLoad ManagementSmart grids

Micro-grids


What is best?• Depends on the application

– Resources• Especially variable and non-dispatchable renewables

– Loads– Equipment prices– Equipment performance

• A confused mind says “No!”• Requires a simple tool

– Smaller projects cannot afford complex tools

• Modeling to grow the industry2334 Broadway, Ste. B, Boulder, Co. 80302

Introducing HOMERHybrid Optimization Model for Electric Renewables

1993: Developed at NREL for Village Power1998: Released to public2009: Spun off to HOMER Energy2010: First commercial version2011: Web-based version

System Architectures

Decision Support Framework

Hourly Energy Balance

Simulation

Optimization

Sensitivity Analysis

It Comes Down to Economics

• Saving oil is a more reliable business model than chasing subsidies


0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25-600,000

-400,000

-200,000

0

200,000

Nom

inal

Cas

h Fl

ow ($

)

Cash Flows

Year Number

Northern Pow er NW100/19DieselSurrette 6CS25PConverter

Sensitivity

Which system is best under what conditions?

Penetration Contribution Analysis from HOMER

Molokai (8.3 meter per second wind resource)

$0

$20

$40

$60

$80

0 2 4 6 8 10 12Diesel Fuel Consumption (Million liters per year)

Life

cycl

e C

ost

(US$

Mill

ions

)

High Medium Low

No Wind


Foundation Costs


Total installed turbine cost

$300,000

$600,000

$900,000

Wind-Diesel Cogeneration

What is the minimum fuel price for wind-diesel to be cost-effective?Does it depend on the size of the thermal load?Trade-off between waste heat from genset and dump load

Additional Insights• The challenge of renewables is not what to

do when the wind doesn’t blow. It is what to do when the wind blows too strongly

• A little bit of storage goes a long way• The highest value of storage is not load

shifting• We could have saved billions of $s killing

bad ideas quickly with more HOMER analysis


Results

Business Model

Software- Free simple version- Paid SaaS modules

Community- Sharing designs and

expertise- Blog and industry news

Services- Strategic Planning

- System Design- Market Research

Custom

Training

LeadsAds

Data on user

behavior

Customer Segments

New users by month

• No connected grid– Islands– Remote applications

• Inadequate grid– Developing nations– Ultra-reliable applications– Micro-grids

• Smart grid– High renewable penetration– Storage– Electric vehicles

0

200

400

600

800

1,000

1,200

20102009200820072006200520042003200220012000

54,000 USERS


User Base Profile

193 countries


Status of global microgrid marketRedesigning user surveys

Version 3

www.homerenergy.com 2334 Broadway, Suite B, Boulder, Co. 80302



Dr. Peter LilienthalCEO

[email protected]

(720) 565-4046

HOMEREnergy.com

mailto:[email protected]


the economics of wind-diesel microgrids

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