Renewable integration for remote communities: Comparative allowable cost analyses for hydro, solar and wave energy

Abstract

Many remote communities are reliant on diesel-fueled electricity generation. The extra-ordinary logistical and financial complications in acquiring fuel often result in energy poverty. To alleviate these realities, and simultaneously mitigate noise and emissions, communities are focused on harnessing local renewable resources to achieve aggressive decarbonization and renewable energy penetration.This study quantifies the diesel and emissions mitigation potential of micro-hydro, solar and wave energy; and defines ‘allowable-cost’ Levelized Cost of Energy (LCOE) targets. Through the application of a bottom-up, time domain energy systems model, Remote Community Optimization Model (RCOM), differing renewable options (including wave, micro-hydro and solar) are compared. The RCOM model formulates the community’s energy system operation as a cost minimization optimization problem and generates an hourly dispatch strategy. Comparing hybrid renewables-based systems to the diesel only case, the maximum allowable LCOE values for each renewable energy system to provide economic benefit to the local community are quantified. Additional sensitivities to resource availability, emissions pricing and fuel costs are explored through scenario-based sensitivity analyses.Utilizing RCOM for Hot Springs Cove (remote Canadian community), the diesel system results in LCOE of $0.76/kWh. The development of a small hydro system (225 kW) reduces the community’s fuel costs by ~$5.2 M over the 30-yr. project lifetime. However, these savings are less than the upfront construction capital, and the associated LCOE increases to $1.36/kWh. Based on the novel ‘allowable-cost’ analysis, wave energy was found to provide economic benefit if the supplied power could be delivered for less than $0.59/kWh; with the added benefit of reducing diesel consumption by 40%, and returning $23,206/kW installed. Comparatively, integrating solar had an allowable-cost LCOE of $0.53/kWh, reduced diesel consumption by only 12%, and gave a return of $6844/kW installed.