Introduction

The Dominican Republic more specifically Santo Domingo experiences high electricity costs and frequent blackouts and brownouts due to several factors. While many of these factors are systemic and out of control of the general public, the island nation enjoys several unique characteristics that could make the economic viability of residential solar electricity generation a reality.

Objective Statement

The objective of this study is to determine the economic viability of the implementation of a stand-alone grid tied solar system to satisfy energy demand in the following five scenarios for the model house, supply enough energy to meet average monthly second tier demand, supply enough energy so that second tier energy is never purchased, supply as much energy as possible without ever exceeding demand, supply enough energy to meet average total demand and supply enough energy to go off-grid (excess energy produced during most months).

Energy Profile

  • DR island nation that imports 86% of its combustibles for electric power generation.
  • 3% of GDP in 2008 went to subsidize the losses of the grid
  • Frequent blackouts/brownouts
  • Structural problems (Gov't middle man between private generation and residential use) (Capacity of the grid)
  • Lots of illegal connections
  • low collection on bills

Residential Stand-Alone Grid Tied System

A stand-alone grid tied system is essentially the same as a grid tied system except for the addition of a battery bank allowing uninterrupted power even when the central grid fails. The components for this type of system include a battery bank, an inverter which also acts as a battery charger and photovoltaic panels.

Assumptions

  • One home is chosen as a case study. This home has to be middle class and own a battery bank capable of satisfying 22 hours of autonomy and an inverter.
  • Average energy usage is calculated by an audit conducted by the team under the supervision of it's residents. This data is verified by the most recent electricity bill.
  • Residents will remain in this house and their energy usage will remain constant.
  • Law 57-07 will stay in effect for at least the first three years of the projects lifespan.
  • Increasing electricity tariffs will follow the predicted forecasts for crude oil in the global market. As crude oil is the main imported fuel stock used to generate electricity in the Dominican Republic.
  • Financial parameters are assumed constant throughout project lifetime. See tab on Google spreadsheet.
  • Project lifetime is twenty years.
  • Prices of hardware are representative of market value.
  • Excess energy generated is not sold back to the grid.

Data Sources

Environmental

Meteorological data including average solar insolation for the city of Santo Domingo is provided by RetScreen[1], a Canadian renewable energy program. This data comes from ground monitoring stations and/or from NASA's global satellite/analysis data.

Financial

Taking out a loan contributes to the viability of the project. Assume banks allow for a five year debt term at 10% interest. This assumption is supported by the fact that the debt service coverage ratio is greater than one for all cases meaning, the revenue generated by the solar project is great enough to cover the annual debt.

Legislative

Law 57-07[2] passed in May 2007 provides incentives to public and private projects that demonstrate financial, environmental, technical and physical viability. This law expressly encourages the installation and exploitation of pre-approved photovoltaic systems with no restriction on production. Incentives include:

  • Exemption of import duties for all equipment necessary to generate energy from renewable source
  • Exemption of ITBIS for certain equipment expressly listed in the law
  • 5% reduction on interest on foreign financing on renewable energy projects
  • A single tax credit of up to 75% on the cost of capital equipment used in pre-approved projects that change to or expand the use of renewable energy in residential, commercial, or industrial establishments. The tax credit is apportioned over a three- year period at the rate of one-third per year

Components Specifications

Panel Specifications

  • Panel Voltage: 36 V
  • Panel Footprint (m^2): 2
  • Panel Wattage: 250W
  • Panel Efficiency: 12.5%
  • Cost per Unit: $24700 (RD), $650 (US)

Battery Specifications

  • Number of Batteries in Bank: 4
  • Battery Voltage: 12 V
  • Peak Current Output: 25 amps
  • Battery Capacity, C/10 Rate: 200 amp-hrs
  • Chemical Conversion Efficiency: 80%
  • Depth of Discharge: 70%
  • Cycles per lifetime: 1200
  • Estimated lifetime: 3.29 years
  • Cost per Unit: $5600 (RD), $150 (US)
  • Bank Capacity (full discharge): 9.6 kWh
  • Hours of Autonomy: 22.17 hours
  • Replacement Batteries during project lifetime: 24.33
  • Replacement Costs, Annuity: $6,813 (RD), $180 (US)
  • Replacement Costs, Present Value: $122,950 (RD), $3,235 (US)

Inverter Specifications

  • DC Voltage: 36V
  • AC Current Output: 4kW
  • Inverter Efficiency: 95%
  • Miscellaneous Losses [heat, internal loads, etc]: 5%
  • Cost per Unit: $81,400 (RD), $2,142 (US)

System Design

[1]

A google spreadsheet was developed to model the relationship between: historical energy use, energy-based objectives, hardware specifications, financial parameters, and the associated measures of project feasibility.

Site Data

The flow of information begins on the 'Site Data' tab, where monthly supply and demand are listed for a representative year. Monthly demands are listed in a format as you might find on an energy-bill, while suppy is listed in terms of the available daily solar-energy per unit area during each month of a typical year. Monthly demand for second-tier energy, and the associated cost, is calculated according to the tier information at the bottom of the sheet.

System Design

Hardware specifications are listed in the 'System Design' tab. The costs associated with hardware are listed on a per-unit basis, while complete package costs are listed on a per-kilowatt basis. An important design parameter found here is the system's autonomous runtime; this is the duration over which a fully-charged battery bank will satisfy household energy needs before requiring recharge (e.g., the maximum number of hours between periods of recharge). Assuming the bank will be recharged each day by solar energy, an autonomous runtime of 12 hours is considered a reasonable target. The spreasheet is designed to help the user determine how many batteries to include in the battery bank, given a desired autonomous runtime. The user may enter the number of batteries to be included in the battery bank, and the physical specifications per unit; the spreadsheet will calculate the autonomous run-time according to the following equations:


where is the Bank capacity (kWh), represents the number of batteries included in the bank, is the Amp-hour rating per battery, is the single-battery output voltage, is the chemical conversion efficiency during charge and discharge, and is the reccomended depth of discharge (usually between 70-80 % for a deep cycle battery), is the autonomous runtime (hrs), and is the average daily energy demand per household (kWh/day).

The System Design tab is also designed to help the user determine the photovoltaic power capacity required to meet energy-based criteria. The user may enter the desired capacity (kW) for up to 5 scenarios in the 'System Design Summary' table. Based upon the desired capacity, the spreadsheet will estimate the associated monthly energy production, as well as the monthly volume of grid-energy required to satisfy the portion of the energy demand not met by the photovoltaic system. Determining the photovoltaic capacity that satisfies a particular set of criteria is therefore an iterative process.


where is the photovoltaic footprint (m^2), is the desired photovoltaic capacity (kW), is the photovoltaic power density (kW/m^2), is the solar energy produced during month 'x', is the photovoltiac sunlight conversion efficiency, is the available solar energy density (kWh/day/m^2), is the number of days in month 'x', is the grid energy required to satisfy the portion of the demand not met by the solar resource during month 'x', and is the household energy demand during month 'x'.

Battery Maintenance Cost

The spreadsheet will also calculate the costs associated with battery maintanence over the lifetime of the project. Assuming each battery experiences one cycle per day(charged during the day, discharged at night), and assuming maintenance costs are distributed uniformly over the life of the project, the present value of battery maintenance is calculated by the spreadsheet according to the following equations:

Estimated Battery Life (yrs) = (Cycles per battery) / (365 days/year)

Batteries purchased during project lifetime = (# batteries in bank)*(Project lifetime, yrs)/(Estimated Battery Life, yrs)

Annual Maintenance Cost ($) = (# Batteries purchased during project lifetime) * (Cost per unit, $) / (Project Lifetime, yrs)



Case Buyback Time Net Present Value Benefit/Cost Ratio Debit Service Cover Ratio
Case 1 17 years $5,830 1.16 2.04
Case 2 12 years $27,996 1.64 2.31
Case 3 3 years $94,494 2.44 2.75
Case 4 3 years $116,660 2.60 2.84
Case 5 3 years $145,779 2.53 2.81

All values at the BLANK confidence

Contributors

  • caribe solar
  • wilson medina
  • abogado
  • Vanessa Callas

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