Socioeconomically sustainable rural microgrid engineering design

More than 80% of the 1.2 billion individuals without electricity live in rural regions of developing countries. For many of these communities, electricity access through the traditional paradigm of power infrastructure growth, increasing generation capacity of centralized grids and installing capital intensive transmission lines, substations, and distribution lines, will be financially infeasible. Instead decentralized, stand-alone microgrids provide a financially feasible option for providing electricity access. The fundamental challenge of rural electrification is how to deliver modern electricity to low income communities in a financially viable way. This paper explores some of the distinctive socio-economic design challenges of microgrid design in a rural electrification context and highlights the importance of more complex financial models for economic viability than levelized cost of electricity. A case study is presented of a model village with a population of 450 households. Business and technical frameworks are presented and discussed for the model village based on a hybrid DC microgrid with both a biomass gasifier and solar panels. The microgrid is optimally sized through minimizing the amount each household must pay per month for electricity to provide basic lighting and cell-phone charging. The results of the case study provide evidence that mini-utility startups require more sophisticated economic modeling in technical design than net present cost and levelized cost of electricity (LCOE) to achieve long-term sustainability due to the constraints created by minimal income of end-users.