Hybridization of diesel small grids in Papua New Guinea
02 HYB24-23
Presented by: Diani Tommaso
In Papua New Guinea (PNG), only 13% of the population has access to on-grid electricity, primarily in urban areas. The country has two main grids on the main island and 17 smaller grids in remote towns and outlying islands. However, system reliability is a significant issue, with frequent power blackouts disrupting lives and businesses across all local grids. This project, financed by the International Finance Corporation (IFC), assesses the status of four smaller grids powered by old diesel generators and proposes a retrofit. The project includes a plan to hybridize the current systems with renewable energies to align with decarbonization pathways set in PNG Vision 2050. Additionally, it addresses operational challenges and suggests measures to improve reliability and reduce financial losses.
After an on-site inspection, mapping of generation and T&D assets and data collection, it was determined that PV and BESS were the most suitable technologies to hybridize diesel generation. The optimization process focused on sizing the renewable energy component to minimize tariffs and maintain grid stability. The methodology involved three main steps: (i) conducting HOMER simulations to create contour plots, showing the evolution of key parameters for various PV and BESS sizes; (ii) iterating optimal ranges within a Financial Model to refine results; and (iii) evaluating the stability of the upgraded system using DigSilent Powerfactory simulations.
To achieve high renewable penetration, it was observed that large capacities of PV and BESS are necessary due to the high baseload derived from the daily load profile analysis, which includes an evening peak and high nighttime load. The barriers identified are: i) Higher technology costs compared to other regions due to PNG's early-stage off-grid renewable energy markets, as well as high civil works expenses, hindering the project's viability; ii) Limited land availability in PNG affecting the optimal sizing of PV and BESS; and iii) Relatively low fuel costs at certain sites. As a result, a hybrid system targeting a 30-40% solar fraction is proposed. A BESS for power applications is added to provide ancillary services and reduce the need for generator spinning reserve.
After conducting a sensitivity analysis in the financial models, it is evident that grant funding plays a decisive role. Without grants contributing, under current assumptions, systems reliant solely on fossil fuels achieve the lowest tariffs. However, when grants comprise 50% of total funding, solutions involving solar PV and BESS offer competitive or even cheaper tariffs than diesel-only generation. Assuming 70% grant funding, hybrid systems with PV and BESS become significantly more financially appealing than diesel alone. Hybridizing the generation not only reduces financial risk but also enhances tariff stability while decreasing dependence on fossil fuels. This brings about predictable costs for renewable energy, unaffected by oil price fluctuations.
After an on-site inspection, mapping of generation and T&D assets and data collection, it was determined that PV and BESS were the most suitable technologies to hybridize diesel generation. The optimization process focused on sizing the renewable energy component to minimize tariffs and maintain grid stability. The methodology involved three main steps: (i) conducting HOMER simulations to create contour plots, showing the evolution of key parameters for various PV and BESS sizes; (ii) iterating optimal ranges within a Financial Model to refine results; and (iii) evaluating the stability of the upgraded system using DigSilent Powerfactory simulations.
To achieve high renewable penetration, it was observed that large capacities of PV and BESS are necessary due to the high baseload derived from the daily load profile analysis, which includes an evening peak and high nighttime load. The barriers identified are: i) Higher technology costs compared to other regions due to PNG's early-stage off-grid renewable energy markets, as well as high civil works expenses, hindering the project's viability; ii) Limited land availability in PNG affecting the optimal sizing of PV and BESS; and iii) Relatively low fuel costs at certain sites. As a result, a hybrid system targeting a 30-40% solar fraction is proposed. A BESS for power applications is added to provide ancillary services and reduce the need for generator spinning reserve.
After conducting a sensitivity analysis in the financial models, it is evident that grant funding plays a decisive role. Without grants contributing, under current assumptions, systems reliant solely on fossil fuels achieve the lowest tariffs. However, when grants comprise 50% of total funding, solutions involving solar PV and BESS offer competitive or even cheaper tariffs than diesel-only generation. Assuming 70% grant funding, hybrid systems with PV and BESS become significantly more financially appealing than diesel alone. Hybridizing the generation not only reduces financial risk but also enhances tariff stability while decreasing dependence on fossil fuels. This brings about predictable costs for renewable energy, unaffected by oil price fluctuations.