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Off-grid, Mini-grid and Grid Electrification assessed

Contributed by Grant Ballard-Tremeer
Added: 17 January 2008

ESMAP has published a Technical Paper on the technical and economic assessment of Off-grid, Mini-grid and Grid Electrification Technologies. It is now available to download.

From the executive summary:

Today’s levels of energy services fail to meet the needs of the poor. Worldwide, two billion people rely on traditional biomass fuels for cooking and 1.6 billion people do not have access to electricity. Unless investments in providing modern energy services are expanded significantly, this number is expected to actually increase over the next 30 years (International Energy Agency [IEA], 2002). This lack of access to quality energy services, especially electricity, is a situation which entrenches poverty, constrains the delivery of social services, limits opportunities for women and girls, and erodes environmental sustainability at the local, national and global levels. Ignoring the situation will undermine economic growth and exacerbate the health and environmental problems now experienced in many parts of the world.

Developing and transition countries face huge investments in providing the energy access needed to achieve the Millennium Development Goals (MDGs). The IEA estimates the electricity sector investment requirements in developing countries to reach the MDG goal of halving poverty to be US$16 billion annually over the next 10 years (IEA, 2004). Mobilizing such investment and, in particular, undertaking the challenges of rural electrification will require strong political determination, a willingness to prioritize electrification within the overall development agenda and considerable skill in the selection and implementation of technical and economic strategies for electrification.

Experience throughout the world has shown that there is no single or unique way of achieving electrification, either from a financing and implementation viewpoint or from an electrification technology viewpoint. Furthermore, the range of electrification technologies is constantly expanding, and the factors determining the ultimate affordability, availability and sustainability of a particular electrification scheme are becoming increasingly complex. Developments in generation technology and electrification business models have resulted in increasing diversity in how electricity is generated and delivered to end users, including grid-connected mini-grid and off-grid arrangements.

Purpose

The purpose of this report is to convey the results of an assessment of the current and future economic readiness of electric power generation alternatives for developing countries. The objective of the technical and economic assessment was to systematically characterize the commercial and economic prospects of renewable and fossil fuel-fired electricity generation technologies now, and in the near future. Our hope is that this assessment will be useful to electrification planners concerned with anticipating technological change in the power sector over the next 10 years, especially as regards emerging RE technology, new prime mover technology and hybrid configurations which can potentially deliver improved performance and better economics for a given electrification situation. We also wanted to provide these planners and policy makers with systematic comparisons of the economics of various technologies when configured in grid-connected, mini-grid and off-grid applications.

Scope

We examined power generation technologies across a size range of 50 watt (W) to 500 mega watt (s) (MW) organized into three distinct electricity delivery configurations: off-grid, mini-grid and grid (Table 2). Generation technologies examined included renewable energy technologies (RETs), (photovoltaic [PV], wind, geothermal, hydro, biomass-electric, biogas-electric); conventional generation technologies (gasoline or diesel generator; oil/gas steam-electric, combustion turbines (CTs) and combined cycle; coal-fired steam-electric); and emerging technologies (integrated gasification combined cycle [IGCC], Atmospheric Fluidized Bed Combustion [AFBC], fuel cells and microturbines). The economic assessment was performed for three different time periods (2005, 2010 and 2015) in order to incorporate projected cost reductions from scaling-up of emerging technologies. A levelized analysis of capital and generation costs was conducted in economic, rather than financial terms, to allow generic applications of results to any developing country. Capital and generation cost projections incorporated uncertainty analysis, allowing the results to reflect sensitivity to key input assumptions. The study results make it possible to compare the levelized economic costs of electricity technologies over a broad range of deployment modes and demand levels, both at present, and in the future."

The report may be downloaded from the ESMAP website here Technical and Economic Assessment of Off-grid, Mini-grid and Grid Electrification Technologies (PDF, 1MB)



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