A New Approach to Design and Optimize Sizing of Hybrid Microgrids in Deregulated Electricity Environment

The demand for electrical energy in urban and suburban areas is increasing drastically because of various reasons. The electricity bill has increased significantly due to increased comfort levels and uses of modern appliances. Therefore, the demand response along with the power generated from renewable energy resources is playing an important role in reducing electricity bills without compromising any comforts. In this paper, a novel framework is proposed for the selection of renewable energy resources and sizing optimization with reduced costs and increased productivity for the end-users. The simultaneous process of selecting the appropriate renewable energy resources and sizing is covered in three stages: initially, the prediction of power from the renewable energy resources to perform a feasibility analysis is provided. Then, the sizing of the battery energy storage system for a grid integrated system to meet the load profile is performed. Finally, the performance analysis of the proposed microgrid in a deregulated electricity environment is performed. The modeling of the proposed hybrid microgrid considers load flexibility and the stochastic behavior of renewable energy resources. Moreover, the net metering concept (bi-directional energy exchange) is applied. For the developed model, the percentage of annualized return of investment (AROI) is found to be 6.8% with a payback period of 6.67 years.