Abstract
Microgrid deployment has offered technical and economical benefits such as improving grid reliability, maximizing penetration of intermittent renewable energy sources, reducing the cost of energy production, etc. However, to realize those advantages, the costs of microgrid implementation may be bloated as microgrid need additional investment for the enabling technologies. Therefore, an appropriate approach to determine the economic viability of microgrid to quantify the values of microgrid benefits is needed. This study performs a techno-economic analysis of a small-scale grid-connected microgrid deployment which consists of photovoltaic (PV) and energy storage system. The analysis is done by considering the possible bussines models available in Indonesia where the microgrid test case is located, i.e, net metering for electricity bill, feed-in tariff for utilizing renewable energy, demand response (DR) implementation by exploiting battery roles in response of price variation during peak and off-peak period and assuming compensation is given every time microgrid is in islanded mode due to fault event occur in the main grid. The feasibility of each model is indicated by the microgrid’s net present value (NPV) and internal rate of return (IRR). The results show that further incentives from the utility or Government is required to make the small-scale microgrid deployment economically sustainable.
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