IEEE- International Conference On Advances In Engineering, Science And Management (ICAESM -2012) March 30, 31, 2012

94

Economic Cost Analysis ofHybrid Renewable

Energy System using HOMER
U. Sureshkumar

Dr. P.S.Manoharan

A.P.S. Ramalakshmi

Electrical & Electronics Engg. Dept.

Mohamed Sathak Engg. College
uskrk@sify.com

Electrical & Electronics Engg. Dept.

Thiagarajar College of Engineering
psmeee@tce.edu

Electrical & Electronics Engg. Dept.

Thiagarajar College of Engineering
apsreee@tce.edu

Abstract -- This paper deals with the optimal cost analysis of hybrid
renewable energy system (HRES). The optimal cost analysis of
HRES is done using Hybrid Optimization Model for Electric
Renewable (HOMER). The HOMER energy modeling software is a
powerful tool for designing and analyzing hybrid power systems,
which contain a combination of conventional generators,
cogeneration, wind turbines, solar photovoltaic's, hydropower,
batteries, fuel cells, hydropower, biomass and other inputs. It is
currently used all over the world by tens of thousands of people.
HRES provides the electrical power for a remote located area. In
this paper work, real time optimal cost analysis of HRES is done
based on the load profile, solar radiation and wind speed which was
collected from Mandapam in Ramanathapuram District, Tamil
Nadu in India. HOMER is used here to optimize the system based
upon the Total Net Present Cost (TNPC}. Moreover, the
optimization of system is obtained by varying the sensitivity
variables like solar radiation, wind speed etc. Cash flow summary
of the HRES system is obtained which will be useful for the optimal
cost allocation of each individual component present in the system.

variation of solar and wind energy generation. So in addition

to HRES, battery can be provided at that time to meet out the
load demands [3 ]. Also use of the hybrid system with
(PVIWG) battery reduces battery storage requirement.
Research conducted worldwide indicates that hybrid
PV/Wind/battery system is a reliable source of electricity [4, 5
and 6]. N ational Renewable Energy Laboratory's (N REL)
Hybrid Optimization Model for Electric Renewable
(HOMER) software has been employed to carry out the
present study. HOMER performs comparative economic
analysis on hybrid power systems. Inputs to HOMER will
perform an hourly simulation of every possible combination of
components entered and rank the systems according to user
specified criteria, such as cost of energy or capital costs [7].
In this paper the simulation of a hybrid energy system
composed of PV together with WG, and battery storage has
performed and a power management strategy has designed and
simulated.

Keywords--- COE, HOMER, Optimization, Photovoltaic panel,

TNPC, Wind Generator.

IN TRODUCTION
I.
The utilization of renewable energy for electric power
production is an antique method. N owadays, due to the
tremendous increase in fossil fuels prices and the
environmental problems caused by the use of conventional
fuels, we are reverting back to renewable energy sources.[I]
Renewable energies are inexhaustible, clean and they can be
used in a decentralized way. Also, they have the additional
advantage of being complimentary, the integration between
them being favorable. For example, solar photovoltaic energy
supplies electricity on sunny days while on cold and windy
days, which are frequently cloudy, the wind generators are in
position to supply more electric energy for stand alone and
grid connected applications. HRES are becoming popular for
remote area power generation applications due to advances in
renewable energy technologies.
A hybrid energy system usually consists of two or more
renewable energy sources used together to provide increased
system efficiency as well as greater balance in energy supply
[2]. Even then there will be some power outage due to

II.

SYSTEM DESCRIPTION

The HRES is designed based upon the certain important

sensitivity variables to optimize the cost & size effectively.
Hence, before designing the model, certain parameters like
solar irradiation, wind speed and load profile must be
evaluated. It's presented in the following sections.
A.

Solar Radiation and Wind Speed Data

In this paper work, real time solar irradiation and wind

speed data is collected from Mandapam (Latitude: 9.2833 &
Longitude: 79.1167) for the year 2010. This data is analyzed
for designing an hybrid power system (which includes
PV/WG/Battery) which has to meet a load requirement of a
typical remote village, in our case an average demand of
1.989KWhld. Fig.l shows the monthly average daily solar
radiation ranges from 6.4 to 7.8 (kWhlm2) while Fig. 2
shows the monthly average daily wind speed. Reference [12]
possess the daily averaged data like insolation on horizontal
surface, insolation clearness index, clear sky insolation
clearness index etc. of locations all over the world which is
very much useful for designing HRES using HOMER.

ISBN: 978-81-909042-2-3 2012 IEEE

IEEE- International Conference On Advances In Engineering, Science And Management (ICAESM -2012) March 30, 31, 2012

Moreover online plot of each data as mentioned above are

available.
Global Horizontal Radiation

grid-connected or autonomous and can serve ac and dc electric

loads and a thermal load.

1.0

0.8

f-r-

io,.

95

Copy of Fuhrland..

l-'

Primary Load 1
1,989 kWh/d
207 kW peak

Jan

Feb

MBI Apr

May Jun

Dai11y Radiation

Jul
-

Aug

Seep

Oct

!'Iov

Dec

0.2

Converter

0.0

AC

Cl="" Index

Fig. 1 Monthly average daily solar radiation

8

H2500

DC

Fig. 4 Hybrid power system design using HOMER

Wind Speed Monthly ,\verage

tr

Ja

Feb

0-

Mm

Apr

r-

May

Jun

r-

r-

Jul

Aug

r-

Seep

rr

Oct

Nov

Dec

Fig. 2Monthly average daily wind speed.

nmm':
1z:l1

ft::.lI

'1:11

AJI

IIrtt!

JUII

J lI l

.'.L1j

OU

Nw

A:...

AUII

Fig. 3Monthly average loads (KW) for complete year

B. Load Profile

An important consideration of any power generating

system is load for the efficiency and reliability of power
transmission. In this case study, we have considered a remote
village which lack access to the utility grid. So the measured
annual consumption is considered as1.989KWhld in the
present study. The Fig. 3 shows monthly average load profile.
The peak load requirement decides the size of system. Here
207KW is considered as peak load consumption.
III.
HOMER SIMULAnON MODEL
In the present work, the selection and sizing of components
of hybrid power system has been done using N REL's
HOMER software. HOMER is user friendly software.
HOMER's fundamental capability is simulating the long-term
operation of a micro power system. Its higher-level
capabilities, optimization and sensitivity analysis, rely on this
simulation capability[7].The simulation process determines
how a particular system configuration, a combination of
system components of specific sizes, and an operating strategy
that defines how those components work together, would
behave in a given setting over a long period of time. HOMER
can simulate a wide variety of micro power system
configurations, comprising any combination of a PV array,
one or more wind turbines, a run-of-river hydro- turbine and
up to three generators, a battery bank, an ac-dc converter, an
electrolyzer, and a hydrogen storage tank. The system can be

The FigA shows Hybrid Power System Design Using Homer.

It consists of Photovoltaic array, wind generator, converter,
load and battery. The simulation process serves two purposes.
First of all the feasibility of the system is determined.
HOMER considers the system to be feasible if it can
adequately serve the electric load and satisfy any other
constraints imposed by the user. Secondly, the life-cycle cost
of the system is determined, which is the total cost of
installing and operating the system over its lifetime. In order
to estimate the system performance under different situation,
simulation studies have been carried out using real weather
data (solar insolation and wind speed). Then the system has to
be optimized. For the optimization process, HOMER
simulates many different system configurations, discards the
infeasible ones (those that do not satisfy the user-specified
constraints), ranks the feasible ones according to total net
present cost, and presents the feasible one with the lowest total
net present cost as the optimal system configuration. The goal
of the optimization process is to determine the optimal value
of each decision variable that interests the modeler [7]. A
decision variable is a variable over which the system designer
has control and for which HOMER can consider multiple
possible values in its optimization process.
Possible decision variables in HOMER include:

The size of the PV array

The number of WG

The Capacity of batteries.

The size of the DC/AC converters

A. Power Management Strategy:
We have discussed here how the power to the load is
dispatched with available resources. The Fig. 5 shows the
daily power output view of PV, WG and AC primary load for
the month of January. Generally, PV and WG supply the
demand of load circuit. The excess energy that is available in
PV and WG is given to the battery until it's fully charged. The
battery is used to improve load power dispatch efficiently
since PV and WG is non- linear source. When the output
power of PV/WG is higher than the load power and also if

ISBN: 978-81-909042-2-3 2012 IEEE

IEEE- International Conference On Advances In Engineering, Science And Management (ICAESM -2012) March 30, 31, 2012

battery's state of charge is maximum, the excess output power

ofpV/WG goes unused. [8, 10, 11 and 12]

96

!m,. -++-----j---_,t_---.+t--+--H'-\----I
o;;" l O))'. -+-'---M-fc----j--jbotll-t+--f.-t-I--+--- I

TABLE I
TECHN ICAL DATA OF HRES
SYSTEM

l " . +---H+-tlH
--YlHf-+-+-'--'-\HI--fl-.---f
t---HI -tl- fH---'I-h!---l!i-----+1'
. ,'. 0 :" ,.

m,..,
. f----HI----\-I---1t++---'I-l----+-"----#

1!-----_,___--;---------,----__,

PVarray
Capital Cost

4061 25US$/kWpk

0&M Cost

Efficiency

20 %

Lifetime

20year

Tracking system

No Tracking

m --jI+-llI---+---:IhI_I\---+__I---- 1

.
J5IUI}'

Fig.5 Daily power output view of load,PV, Copy of Fuhrlander 250(WG)

for the month of January

WG
Technology

Copy of Fuhrlander 250

Power

1 00kW

Hub Height

40m

Capital Cost

335000US$

O&MCost

5000

Lifetime

20year

IV. OPTIMIZATION RESULTS

Battery
Technology

Hoppecke 20OPzS 3000

Capacity

5 kWh

Nominal Capacity

2500 Ah

Voltage

2v

Min.SOC

30%

Capital cost

1 000US$

Replacement cost

300US$

Efficiency

86%

Lifetime

20

Converter
Capacity

1 00KW

Capital cost

400000 US$

Replacement cost

350000US$

Efficiency

90%

Lifetime

1 5year

System Data
Project Life Time

25year

operating strategy

Load following

Without Consideration o/Sensitivity Variables

Simulation has been done by considering different number
of PV capacities and WG. The number of PV and WG unit is
varied. The battery storage size (kWh) considered include 0-6
load-hours autonomy (equivalent to 0-6 hours of average
load).
In optimization process, HOMER can simulate a range of
equipment options over varying constraints and sensitivities to
optimize small power systems. Depending on the Total N et
Present Cost (TN PC), feasible system configuration will be
displayed at the optimization result window. The combination
of system components is arranged from most effective cost to
the least effective cost. The optimization results are done for
every selection of sensitivity variables in HRES, table II
shows the optimization results for the HRES without
considering the sensitivity variables. As shown in table II, the
minimum cost of energy obtained from the results is
0.23 5 $/KWh (INR = 12) against 0.382$/KWh (INR =18) for
the PV capacity of 2000KW, WG & battery of 10 numbers
and converter of 10,000KW. Moreover, the total operating
cost is $86,279 per year and also some of interesting
information came out from above simulation result was that
operating cost and TN PC as well as COE went to increase in
linear manner, when we will increase the size of the PV
without changing of the size of the Wind as well as converter
at the same time when we have increase the size of the Wind it
leads to enormous increase in Operating cost from $86,279 to
$100.717. From the above simulation work we have
concluded that cost of the PV deeply depends upon the cost of
the energy in my simulation work.
A.

B. With Consideration o/Sensitivity Variables

The optimization results are also obtained based upon the

sensitivity variables like solar radiation of 6 kWh/m2/d and
wind speed of 7.0 (m/s) which is presented in table III. It can
be noticed from these results that without Battery system our
proposed system to provide the reliability of supply and also is

ISBN: 978-81-909042-2-3 2012 IEEE

IEEE- International Conference On Advances In Engineering, Science And Management (ICAESM -2012) March 30, 31, 2012

97

0.233$/KWh as shown in table II.

The monthly average electric production is shown in
Fig. 6.

the most commercial and also economical compared to

previous optimization result (i.e.) without sensitivity variable
[9]. As in [1], HRES COE is 0.296$/KWh with consideration
of sensitivity variable whereas in this paper HRES COE is

TABLE II
OPTIMIZATION RESULTS WITHOUT CONSIDERATION OF SENSITIVITY VARIABLES
System Type

FL250

PV(KW)

Hoppecke

Converter

Total Capital

Operating

Total NPC

COE

200PzS

(KW)

Cost($)

Cost($/Yr)

(in $)

($/KWh)

3000

r I&
r. 1&

r:;t: t;jJ I&1;;;]

"

2000

10

10

10,000

920,000

86,279

2,022,938

0.235

2000

15

10

10,000

1,170,000

100,777

2,458,266

0.283

10000

10

10

10,000

1,720,000

87,112

2,833,582

0.328

10000

15

10

10,000

1,970,000

101,622

3,269,065

0.375

TABLE III
OPTIMIZATION RESULTS BY CONSIDERING SENSlTIVITY VARIABLES (GLOBAL SOLAR= 6KWH/m2/d
System Type

PV(KW)

FL250

Hoppecke

& WIND SPEED =7m1s)

Total Capital

Operating

Total NPC

COE

Cost($)

Cost($/Yr)

(in $)

(KWh/Yr)

10,000

920,000

86,198

2,021,902

0.233

Converter (KW)

200PzS
3000

1':.e
1" .
1" p. e
1" j[t!, e
1':
1" )iAe

10

2,000

10

2,000

15

10,000

1,150,000

98,932

2,414,681

0.280

2,000

15

10

10,000

1,170,000

100,709

2,457,394

0.281

10,000

10

10

10,000

1,720,000

87,049

2,832,773

0.326

10,000

15

10,000

1,950,000

99,800

3,225,785

0.373

10,000

15

10

10,000

1,970,000

101,559

3,268,264

0.373

Monthl Averag:e, E r,ectric Prodl uctio n

1.600

r-

1.200 -

'
".

0
!Ii.

r-

-r-

r--

-r-

-r-

Ja n

-r-

r-

Fe b

M ....

Ap"

-r-

-r-

1--

r--

May

Jun

r-

r-

-r-

Jul

1-

-I-r-

r-r-I-- -r-r- I-- -r800 r-1-- r-

PV

r-

- W in

r-

1--

r-

400

1--

1- r---

-r-

1--

1--

1- -

-r-

1--

1--

1- -

Aug

Sep

Fig,6Monthly average electric production

ISBN: 978-81-909042-2-3 2012 IEEE

Oct

tole"

Dec

IEEE- International Conference On Advances In Engineering, Science And Management (ICAESM -2012) March 30, 31, 2012

98

IV. COST OPTIMIZATION

The aim of this study is to achieve a stand-alone hybrid
generation system, which should be appropriately designed in
terms of economic, reliability, and environ-mental measures
subject to physical and operational constraints/strategies [13 &
17].
The system cost is defined as sum of PV cost (Cpv), WG
cost (Cwo), battery cost (CSAT) and converter cost ( CConv) .

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[2]

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[3]

M.S. Hossan, M.M. Hossain, AR.N.M.R. Haque, "Optimization and

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The cost for each element should be deducted:

[4]

Cj

Nj

[CCostj + RCostj

Kj

OMCostj]

and

Electrical

Engineering

(EEEIC),

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[5]

pv, WG, Battery and Converter,

IEEE Transactions on , vol.13, no.l, pp.76-83, Mar 1998.

Where Ni is the number/size of the system component,

CCosti is the capital cost, RCosti is the replacement cost, Ki
is the number of replacement, and OMCosti is operation
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configuration.

[6]

W.O. Kellogg, M.H. Nehrir, G. Venkataramanan and V. Gerez,

"Generation unit sizing and cost analysis for stand-alone wind,
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Jarvis and Peter Wolf, "Economic analysis of hybrid renewable

model for SUbtropical climate," International Journal of Thermal

CONCLUSION

&

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This paper has discussed on optimization results and effective

cost analysis of HRES using HOMER. The Cost flow summary is

[12] NASA Surface Meteorology and Solar Energy [Online]. Available at

http://www.nasa.gov
[13] Souissi Ahmed, Hasnaoui Othman and Sallami Anis, "Optimal sizing

found for the designed HRES system. The result analysis shows the

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combination of PV, WG and battery will be optimal choice off grid

without interruption," European Journal

system which is to be used in Mandapam which is located at

Vol.45 No.4, pp.620-62, October 2010.

Ramanathapuram

District, Tamil

Nadu

in

India.

The

cost

of

generating energy from the above hybrid PV/WGllbattery system has

been found to beO.235$/KWh. Also daily view of power output of
PV, WG and ac primary load is analyzed and found [14 & 15].
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utilization rate of wind generation is high, load can be satisfied in the
optimal way, reliable power supply and reduction in the capacities of
PV [16,18].

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ISBN: 978-81-909042-2-3 2012 IEEE

IEEE- International Conference On Advances In Engineering, Science And Management (ICAESM -2012) March 30, 31, 2012

[18] A. Gupta, R.P. Sainia and M.P. Shanna, "Design of an Optimal

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AUTHOR BIOGRAPHIES
U.Suresh Kumar received the M.E.
degree in Applied Electronics in 2001
from Madurai Kamaraj University. He
is currently working as an Assistant
in
Professor
Mohamed
Sathak
engineering College, Kilakarai, Tamil
N adu.
He became a MISTE (LM) in
2004. He is pursuing Ph.D in
optimization of power generation, sizing and cost in
standalone Wind/PV hybrid System.

received Ph.D.
degree in Power System in 2009 from
Anna University, Chennai. He is
currently working as an Assistant
Professor in Thiagarajar College of
Engineering, Madurai, Tamil N adu.
He became a member of IEEE and
IE(I). He is serving as reviewer of
many International Journals. His
research interests are in the area of
Power System and Evolutionary Computing.
Dr.P.S.Manoharan

received the M.E. degree in Power

Electronics & Drives in 2010 from Anna University. She is
currently working as a project fellow in Thiagarajar College of
engineering, Madurai, Tamil N adu.
She is pursuing Ph.D. in real time control of MIMO
system using evolutionary algoritluns. Her research area
includes power electronics.

A.P.S. Ramalakshmi

ISBN: 978-81-909042-2-3 2012 IEEE

99