Learn about microgrids and how they can give access to electricity to millions of people (I / II)

According to the International Energy Agency, there are more than 1.1 billion people who still do not have access to electricity, most of them in rural communities in sub-Saharan Africa and in other regions of the developing world.

Fig 1. World population without access to electricity, divided by regions. Source: IEA.

It is important to remember that without access to electricity it is very difficult for a community to develop, since it is impossible to do even the most basic things, such as preserving food or medicines in a refrigerator, purifying water, or studying at night.

The main reason why this happens is that expanding an electricity grid is extremely expensive, and normally in a developing country money is not an abundant resource. Although it is true that little by little these countries are expanding their electricity networks and reaching more cities, it is very difficult for these electricity grids to reach the remote areas of the country, since it is not profitable to make a large investment to deploy an infrastructure that it’s only going to serve a relatively small community.

As a result, many of these remote communities have no access to electricity. Some communities, at best, would have access to electricity thanks to a diesel generator, a solution that is expensive and polluting.

But with the recent decline in the prices of solar panels and batteries, the situation is changing rapidly, and a new way to electrify remote communities is emerging: this is what is known as a “microgrid”. It is estimated that by 2030, at least 150 million people will gain access to electricity thanks to this solution.

How do microgrids work?

In general, microgrids are used in these remote communities usually consist of solar panels, batteries, and a diesel generator; they usually work like this:

  • During the day, the solar panels cover the demand for electricity and charge the batteries.
  • At night, batteries meet the demand for electricity.
  • In case there is no sun (either because it is night, or because the day is cloudy), and that the batteries are exhausted, the diesel generator goes into operation so that the community can continue to have access to electricity.

This way, communities have access to electricity 24 hours a day, in a totally reliable way. Normally, with this type of systems, it can be achieved that 80-90% of the electricity is of renewable origin, while the other 10-20% is covered by the diesel generator.

Fig. 2. Operation diagram of a microgrid. Source: USAID.

And how expensive is the electricity produced by these systems?

Although the price of electricity produced by microgrids varies greatly depending on the project, in general the price of electricity generated by a microgrid with the characteristics mentioned above  has a price between 0.25 and 0.40 € per kWh. However, many governments in developing countries support these systems through subsidies (as it is much more economical to support these systems than to carry out extensions of the existing electricity grid). When this type of support exists, the consumers in the communities end up paying between 0.05 and 0.10 € per kWh – but it should be taken into account that this type of support does not always exist.

To put these quantities into perspective, in Europe, the price of one kWh is approximately 0.10 to 0.15 €. Compared to this amount, the price of electricity generated by a microgrid is expensive. However, it should be kept in mind that if a diesel generator was used for the generation of electricity (instead of a microgrid with renewables) the price of electricity would be around 0.40 to 0.60€ per kWh. This means that in general, microgrids are the best way for remote communities to have access to electricity, and the improvements in quality of life and economic development associated with it.

Despite this, I think it is important to reflect on the fact that it is not fair that electricity is cheaper in developed countries (where we have more money) than in developing countries. From SbE, we hope that the price of electricity produced by microgrids will continue to fall, so that electricity is accessible to everyone.

And here’s our post today! Next week, Seba, who is in Tanzania visiting communities where microgrids have been installed, will tell us first hand his experience in another post. See you next week!

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