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Difference between revisions of "Economic viability of SME Grid Defection Literature Review"

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*Master's Thesis
*Master's Thesis
*This thesis focuses on two of these new customer usage trends: grid integrated and grid defection.
*This thesis focuses on two of these new customer usage trends: grid integrated and grid defection.

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This page is the literature review for the project of examining the economic viability of grid defection for small to medium size enterprises. This project builds off of many existing papers and other literature reviews that will be linked below. The other literature reviews have been updated as well, this page is more for the collection and keeping track of the work that has been done by Trevor Peffley during Spring 2019 semester.

Papers Read

Hybrid Systems

A combined optimization concept for the design and operation strategy of Hybrid-PV energy systems

  • Optimization strategy for hybrid systems
  • Equations for efficiency and other variables in the hybrid system
  • Sizing and control setting decisions

A review on photovoltaic/thermal hybrid solar technology

  • Photovoltaic Thermal Hybrid System
  • Equations for performance of Hybrid system
  • Focused alot on the possibilities of PV for thermal applications

Analysis of hybrid energy systems for application in southern Ghana

  • Hybrid System consisting of solar, wind, and diesel generators in Southern Ghana
  • Sensitivity analyses, economic analyses (using LCOE)
  • Equations for power output for individual components in the system

Expanding photovoltaic penetration with residential distributed generation from hybrid solar photovoltaic and combined heat and power systems


  • The recent development of small scale combined heat and power (CHP) systems has provided the opportunity for in-house power backup of residential-scale photovoltaic (PV) arrays. This paper investigates the potential of deploying a distributed network of PV-CHP hybrid systems in order to increase the PV penetration level in the U.S. The temporal distribution of solar flux, electrical and heating requirements for representative U.S. single family residences were analyzed and the results clearly show that hybridizing CHP with PV can enable additional PV deployment above what is possible with a conventional centralized electric generation system.


  • PV energy production, which is a large net energy producer and thus CO2 emission reducer, represents an environmentally beneficial and sustainable method of maintaining an energy intensive standard of living. PV, however, has had extremely limited deployment, making up far less than one percent of the global electricity generation due primarily to economics.

Technical limits to PV penetration in the current grid

  • Solar PV offers a technical solution to reduce some of the pressure on the nation’s transmission infrastructure

Electrical and heat requirements of representative U.S. single family residences

  • The average annual electricity use per household in the U.S. is 10,654 kWh
  • By looking at the energy demand and solar supply for a typical home in the U.S. a semi-quantitative analysis can be made at the viability of CHP systems helping increase the penetration level of solar PV.

Design of solar PV and CHP hybrid systems

  • This papers system is consists of three technologies, Warm air heating system, natural gas engine generator, PV array.

Methodology: sizing the PV+CHP System

  • First, the PV+CHP systems will be sized so that the CHP system can provide complete backup of the PV system to allow the maximum PV penetration


  • From this preliminary work it is clear that hybridizing CHP with PV can expand the PV penetration level based on conventional centralized electric generation. This study found that a PV+CHP hybrid system overcomes the inherent challenges of intermitancy and enables the share of solar PV to be expanded without completely depending on energy storage technologies to provide backup for PV.

LCOE/Economic Evaluations

Assumptions and the levelized cost of energy for photovoltaics


  • Generally, LCOE is treated as a definite number and the assumptions lying beneath that result are

rarely reported or even understood.


  • Solar energy is the most abundant renewable energy sources, but still represents a small fraction of the overall worldwide electricity production. Mostly because cost of generation from PV is higher than grid connected (currently).


  • LCOE can be thought of as the price at which energy must be sold to break even over the lifetime of the technology.

Solar degradation rate

  • The rate at which solar cell performance degrades may depend on the type of solar cell, quality of manufacturing, power production level, and local weather/climate.
  • system degradation rate is generally treated as a single value in LCOE calculations despite the fact that it is known that even within a single PV installation individual panels will degrade with substantially different rates.

Tax Rates and Subsidies

  • As with inputs such as solar insolation, taxes and incentives for promoting solar energy also vary widely by location. In our model we have used a consistent federal tax rate of 30% and state tax rate of 8%.


  • Monte Carlo Simulation used to create distributions

Leaving the grid: An ambition or a real choice?


  • The recent rapid decline in PV prices has brought grid parity, or near grid parity for PV in many countries. This, together with an expectation of a similar reduction for battery prices has prompted a new wave of social and academic discussions about the possibility of installing PV–battery systems and “leaving the “grid” or “living off-grid”.


  • Global cumulative installed capacity of PV was 1.4GW in 2000, 100GW in 2012, and 318.9GW at the end of 2013. This increase has spurred a more positive image of PV.
  • Fast decline in PV prices has brought grid parity in many regions.


  • Look into the capital costs of components to make sure that it is viable for specific application


  • The feasibility of renewable technologies is critically dependent on the location's richness in terms of the energy resources(e.g. GHI for PV and wind speed for wind turbine)


  • Defecting from the grid in a widespread scale may not be a realistic projection of the future, if economics is assumed as the main driver of customer behavior.

Energy and economic evaluation of building-integrated photovoltaics


  • This paper applies energy analysis and economic analysis in order to assess the application of solar photovoltaics (PVs) in buildings.
  • there are substantial resource benefits to be gained from using PVs to supply electricity, but the economic cost of doing so is significantly higher than conventional sources. This trade-off is reduced when the benefits of building integrated PVs (BiPVs) are considered. By comparison with centralised PV plants, BiPV systems offer the “double dividend” of reduced economic costs and improved environmental performance.


  • When assessing the viability of technologies such as photovoltaics (PVs) it is important to

recognise the dynamic nature of technological development.

  • PV systems integrated into or mounted onto buildings can avoid the cost of land acquisition,

fencing, access roads and major support structures for the modules.


  • This paper compares costs in energy and economic terms of supplying a kWh of electricity to

the point of use.

  • Economic viability is determined by the profitability of an investment decision or the cash flo

implications of a project. Put simply, to be economically viable an investment must promise a rate of return greater than the cost of capital needed to finance it.

Data and Assumptions

  • The data presented for PVs are for poly-crystalline silicon (p-Si) frameless modules of 1 m2.

Data for mono-crystalline modules were also available but the difference between the technologies was negligible and within the range of uncertainty in the results.


  • for each kWh of electricity supplied from the average European electricity mix a total of 13.2 MJ of primary energy is used, 11.4 MJ in generation and 1.8 MJ in transmission and distribution.
  • for a centralised PV plant 4.15 MJ of primary energy is embodied in each kWh of electricity supplied to the point of use. 3.4 MJ is embodied in each kWh produced by the PV system divided 55:45 modules to balance of system. However a further 0.7 MJ is embodied in transmitting the electricity to the point of use.
  • 2.9 MJ of primary energy is required to supply each kWh of electricity from a BiPV cladding system to the point of use within the building on which it is placed.
  • embodied energy is reduced to 2.6 MJ per kWh supplied if the energy embodied in a conventional glass cladding system is deducted from the BiPV system as an avoided burden.

Net metering and arket feedback loops: Exploring the impact of retail rate design on distributed PV deployment

  • Not very useful as it focuses on the economics of Net Metering with respect to PV costs, which means that this paper focuses on grid connected systems and we're looking for grid defection.

On the utility death spiral and the impact of utility rate structures on the adoption of residential solar photovoltaics and energy storage


  • Today, many electric utilities are changing their pricing structures to address the rapidly- growing market for residential photovoltaic (PV) and electricity storage technologies.
  • Paper presents a dynamic model that predicts the retail price of electricity and adoption rates of residential solar photovoltaic and battery systems.


  • Utility death spiral is a positive feedback loop where electric utility customers switch to a distributed generation system causing a fast decline in electricity demand, causing higher prices, driving more customers away.
  • Solar PV is growing faster than any other DG technology.


  • Create a model that consists of 1) adoption of PV and battery system, 2)Traditional utility model, and 3)net present value of customer purchasing a PV and/or battery system.


  • The primary outputs of the model are the retail price of electricity and the number of each type of household at every time step
  • For the purposes of this discussion, we define a death spiral as a scenario in which the number defectors exceeds the number grid-connected customers at any time step within the simulation time.


  • A utility death spiral due to solar photovoltaic and battery systems is highly unlikely.


  • Looks at the economics of different configurations of solar hybrid systems
  • Study finds that Solar-plus-Battery Systems Rapidly Become Cost Effective, Solar PV Supplants the Grid Supplying the Majority of Customers’ Electricity
  • Large kWh defection could undermine revenue for grid investment


  • Very Long
  • Looks for the point at which solar + battery reach grid parity
  • Models four cases, 1) Base Case-uses average of generally accepted cost forecasts for solar and batterys load, in combination with occasional use of a diesel generator. 2) Accelerated tech improvement. 3) Demand side improvement. 4) Combined improvement
  • Declining costs for distributed energy tech will lead to grid parity and beyond
  • analysis for the base case found that solar-plus-battery grid parity is already here or imminent for certain customers in certain geographies, such as Hawaii. Grid parity will also arrive within the next 30 years (and in many cases much sooner) for a much wider set of customers in all but regions with the cheapest retail electricity prices.
  • This paper conflicts with another in this literature review in believing that the utility death spiral is a real threat.


  • Master's Thesis
  • This thesis focuses on two of these new customer usage trends: grid integrated and grid defection.
  • The aim of the thesis is to develop a quantitative analysis to assess the economic potential of DES component technologies for facilitating electricity grid defection.
  • It is evident that there exists a conflicting condition. For a grid integrated option, a small PV system is less costly, but is unable to satisfy a higher percentage of grid independence. Therefore, it implies grid connection is necessary. On the other hand, 100% grid independence is only possible with a very large PV battery system which is subject to significant DER capital costs. Off grid systems need to be oversized to guarantee stand-alone reliable service. However, according to PV generation results in grid defection option, such system will have a very high unused energy which could be a revenue source higher than the annual grid connection fee (supply charge).

Micro-generation / Sustainability

Assessing the impact of micro-generation technologies on local sustainability

  • The importance of micro-generation as an instrument to reducing carbon emissions in the building sector
  • Importance of balancing the needs of electricity and heat
  • Simulations of how micro-generation can effect energy production and carbon emissions in two target years (2020 and 2050)
  • The work addresses the effect of local energy policies for the achievement of challenging climate targets, focusing on the impact of micro-generation technologies on the energy systems.

PV Efficiency/Optimization

Cooling methodologies of photovoltaic module for enhancing electrical efficiency: A review

  • Mostly about cooling PV modules which can affect the lifespan and power outputs adversely.
  • Not very useful considering most of the year for the case this paper is looking at is very cold.

Design optimization of a large scale rooftop photovoltaic system


  • This paper presents the optimization process of a grid connected photovoltaic (PV) system, which is intended to replace a large-scale thermal solar system on the rooftop of a Federal office building.
  • The optimization method is based on maximizing the utilization of the array output energy, and, at the same time, minimizing the electricity power sold to grid.


  • the cost of entire system still remains relatively high compared with traditional power generation technology. The high cost necessitates that the design parameters, such as surface tilt angle and array size, should be optimized.

Parameter Optimization

  • Goes into the different factors that need to be optimized in a PV Array such as tilt angle, and Array size optimization for needs (in grid connected system)


  • A 43.2kW grid connected PV system was was designed and its performance at local climate conditions was simulated.

Solar energy under cold climatic conditions: A review☆


This paper presents an extensive review of solar-energy-based technologies and research work conducted under cold climatic conditions. These conditions include mountainous, continental, cold oceanic and polar climates and in general, all climates where below Zero temperatures are common during the winter.


  • Energy issues will dominate the world situation during the 21th century. The increase in the CO2

concentration in the atmosphere and the consequences in terms of climate change are expected to be dramatic.

  • Solar energy has been mostly developed in hot sunny regions, but research on them in cold climates is still developing.
  • Solar Cells have better efficiency at colder temperatures.

Solar Energy use under cold conditions: review

  • Covers Building Optimization, Historical Building integration, Greenhouses for solar/thermal, solar thermal collectors, solar cooling, and solar combined with other energy supply solutions.


  • This review highlights various research studies conducted recently on the use of solar energy under cold conditions.
  • On a general basis, most of these studies demonstrate that developing solar energy is an advantage even under cold climates.


Commercial and Residential Hourly Load Profiles for all TMY3 Locations in the United States

  • Data regarding DOE energy usage

Papers from other Literature Reviews