Optimal break-even distance for design of microgrids

Around the world there are many rural areas need access to electricity, extend the transmission line is one option. However, the long distance between the nearest main grid and the rural system as well as the costs of transmission line expansion rapidly increasing makes grid extension difficult, costly and economically unviable. Therefore, using microgrid technology with renewable energy options to meet electricity demand in remote locations becomes more attractive. In this paper the break-even distance which makes electricity from microgrid cost effective over the one form main grid is calculated. Moreover, the Net Present Costs (NPC) of both providing electricity through the microgrid and the main grid are calculated and compared. Five different cases including a diesel-only, a fully renewable-based, a diesel-renewable mixed, a solar-only, and a wind-only microgrid configurations are designed, to compare and evaluate their economics with the main grid. The well known energy modeling software for hybrid renewable energy systems, HOMER is used in the studies reported in this paper.