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Deployment of MicroGrids in India
V. S. K. Murthy Balijepalli, Student Member, IEEE, S. A. Khaparde, Senior Member, IEEE, and C. V. Dobariya
Abstract—The MicroGrid concept using renewable energy
sources is a building block towards the future energy networks for
long-term viable solution of energy needs. The focus of the paper
is centred around the encountered and foreseen issues, enabling
technologies and economics for encouraging the deployment
of MicroGrids in India. This paper presents state-of-the-art
issues and feasible solutions associated with the deployment
of MicroGrid technologies leading to the conceptualization of
efficient and smart MicroGrids. The role of enabling technologies,
automation and communication for sustainable development of
MicroGrids is also explained here.
I. I NTRODUCTION
HE MicroGrid concept, involving small transmission and
distribution (T&D) networks, efficiently makes use of
all the location specific distributed generations (DGs) and
distributed energy resource (DERs). These are self sustained
power systems mainly based on loads fed through radial distribution systems and can operate either interconnected to the
main distribution grid, or even in isolated mode [1]. This small
self-sufficient system would allow maximum extraction of the
renewable power by coordinating control between renewable
and the fossil fuel based generators. The concept is driven by
two fundamental principles:
1) In order to reap the benefits of integrating distributed
energy resources in electric power systems, the stakeholders (customers), utilities and society should employ
a “systems perspective”.
2) A business case model should be developed with the
objectives of achieving reduction in the initial investment
cost including measures that bring in value enhancement.
The quantum of various salient technologies adopted separates the constitution of one MicroGrid from another, and the
operational constraints vary accordingly. Though they all conceptually have the same goals, the way they are implemented
is dependent on the type of dispersed generation facilities accessible. The practical implementation of a MicroGrid admits
wide variety of exercises that include economic analysis [2],
[3], power control strategies [4], grid connection issues [5],
stability and protection issues [1], operating policies [6], etc.
After implementation, all the advantages of a MicroGrid may
not become apparent right away because of higher cost of
energy as compared to the cost of grid power [7]. Hence,
T
V. S. K. Murthy Balijepalli is a research scholar with the Department of
Electrical Engineering, Indian Institute of Technology Bombay, India, 400076.
e-mail: [email protected]
S. A. Khaparde is a professor with the Department of Electrical Engineering, Indian Institute of Technology Bombay, India, 400076. e-mail:
[email protected].
C. V. Dobariya is a senior project engineer with the Department of Electrical
Engineering, Indian Institute of Technology Bombay, India, 400076. e-mail:
[email protected]
978-1-4244-6551-4/10/$26.00 ©2010 IEEE
immediately the economic arguments behind the viability of
MicroGrids will be in focus and which are mainly driven by
the regulatory and economic frameworks of DGs/DERs. Thus,
to get the status of MicroGrids as public viable utilities, it is
very important to evaluate and address the related regulatory
and economic issues. To justify their viability, the decision
making process should be strengthen, these include multiple
attributes like cost of energy, loss of load probability, energy
not served, thermal load, etc [2].
There will be new requirements in two-way metering,
connection charges, and tariff mechanisms to increase the rate
of adoption of MicroGrids in the near future. Therefore, a
detailed economic analysis continues to be a gap to be filled
in. In addition to the envisaged increase in local reliability,
improvement of voltage and power quality, and reduction
of emissions, new market opportunities for MicroGrids are
also being seen as one of the stronger signals for economic
justification of their implementation and promotion. The key
driver for deployment of sustainable MicroGrids in developing
countries like India is the need to provide electricity in
(remote, rural areas) and energy security especially in urban
areas, reduction in green house gases, and power quality. In
this context, this paper mainly covers the various issues which
will strengthens the economics of MicroGrids. This paper also
identifies the enabling technologies for efficient operation of
MicroGrids in the smart paradigm and details some of the pilot
projects implemented in India.
The general organization of the paper is as follows, In
Section II, an overview of Indian renewable energy scenario
and status of operational MicroGrids are presented. Section III presents various economic issues and challenges in
the deployment of MicroGrids. The identified technologies for
efficient and economic operation of MicroGrids are presented
in section IV. Details of smart MicroGrid pilot projects are
explained in section V. Section VI concludes the paper.
II. I NDIAN R ENEWABLE E NERGY S CENARIO AND S TATUS
OF M ICRO G RIDS
In the past several years India has seen significant growth
in renewable energy generation. Fig. 1 shows installation of
various energy resources as in the year 2009 and projected
installed capacity in the year 2032.
The growth in this renewable energy installation is a combined effect of regional energy development agencies, ministry
of new and renewable energy (MNRE), and private sector participation [8]. Supportive government policies are also driving
renewable energy installation. The planning commission of
India has published integrated energy policy report (IEPR)
which highlights the need to maximally develop domestic
supply options and diversify energy sources for sustainable
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TABLE I
S UNDARBAN REGION M ICRO G RIDS DETAILS
Technology used
Solar Power plant
Solar home lightning
Fig. 1. Renewable energy scenario in India
energy availability. According to IEPR, total renewable energy
may account for 11-13% of India’s energy mix by the year
2032. It also suggests that the distributed nature of renewable
energy sources can provide many socio-economic benefits
for the country. Reference [9] presents various issues and
feasible solutions associated with large scale deployment of
the renewable energy technologies in India. Grid Interactive
Energy sources developed so far in India are Solar, Wind,
Small Hydro and Bio Energy. It is estimated that bio-power
may play a key role in the next couple of decades due to the
availability of abundant bio-fuel of different forms in India.
A. Status of MicroGrids
In the segment of distributed energy resources, a total of
33 grid interactive solar Photo-Voltaic (PV) power plants in
co-ordination with small amounts of bio-power have been
installed in the country with financial assistance from MNRE.
These plants, with aggregate capacity of 2.125 MW peak are
estimated to generate about 2.5 million units of electricity in
a year.
1) Sagar Island MicroGrid - Sundarban region [10]: There
are many isolated DGs of coordinated operation existing in the
country. Popular among them is the Sagar island MicroGrid.
This particular project is being jointly funded by MNRE,
the Government of India, Indo-Canadian Environment Facility
(ICEF) and West Bengal Renewable Energy Development
Agency (WBREDA). The power demand in Sagar Island is, at
present, met from solar power of aggregate capacity 250 kW
and from a diesel generator of 400 kW. The total number
of consumers in the Island is to the tune of 1500 now.
However, there are large number of prospective consumers,
who are waiting for electric power. To meet the requirements,
WBREDA has decided to set up a wind-diesel hybrid power
plant of capacity 500 kW.
In all, the WBREDA has done the activities in Sundarbans
in respect of the renewable energy programme as shown in
Table I. There is a three tier tariff structure set based on
actual electricity consumption for consumers in domestic,
commercial, and industrial categories. The tariff rates are
Rupees 5/kWh for domestic; Rupees 5.5/kWh for commercial
and Rupees 6/kWh for industrial consumers.
2) Asia-Pacific Partnership (APP) programmes: “AsiaPacific Partnership on Clean Development and Climate: APP”
Installed
Capacity
300 kW
Bio-mass Gasifier
3200 kW
approx.,
1000 kW
Wind farm
1000 kW
Remarks
Serving more than
1500 consumers
6000 Nos., serving
about 30,000 people
Serving around 1000
consumers
Grid connected
is the regional cooperation framework established by the
leadership of US to supplement the function of Kyoto protocol [11]. At present, 7 countries (Japan, US, Australia, Korea,
China, India, and Canada) are participating in this activity.
They formed Renewable Energy and Distributed Generation
Task Force (REDGTF) to conduct preliminary and feasibility
studies for development of smart energy solution using various
renewable energies in various countries. One such study has
been carried out in Maharashtra, India for comprehensive
evaluation criteria for distributed power using MicroGrid.
At this moment, the pilot model plant based on the proposed
development scheme for rural electrification is expected to
be executed in India. The project will cover the construction
of pilot model plant consisting mostly of biomass and supported by solar renewable energies. The village people will be
given responsibilities of analysis/evaluation of the sustainable
practicability in its operation and management (O&M) of
power supply facilities. These projects are supported by the
public-private partnerships. The candidate project sites are in
Nandurbar district, Maharashtra state, India. These projects
are expected to be completed by 2012-13. Training on O&M,
technical verification of the projects are being jointly executed
with Japanese Non government organizations (NGOs).
III. E CONOMIC I SSUES AND C HALLENGES IN
D EPLOYMENT OF M ICRO - GRIDS
DGs/DERs are considered as the building blocks for the existence of a sustainable MicroGrid. Economics of MicroGrids
are mainly dependent on the regulatory and the economic
frameworks of DGs/DERs in the respective countries. The
issues of MicroGrid economics can be broadly classified as
shown in Fig. 2.
Fig. 2. Identified economic issues relevant to MicroGrids
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A. Main Economic Issues
MicroGrids have on-site generation. One of the unique
aspects of MicroGrids includes providing heterogeneous levels
of reliability to the end-users as per their requirements. Hence,
in the economic evaluation of MicroGrid, the additional costs
should be considered against the added customer benefits
from islanding capability as well as the additional utility
grid costs of maintaining high system reliability. Participation
of MicroGrids in the ancillary service markets is limited.
However, MicroGrids can provide excellent local ancillary
services in voltage support and others for end-users. These
distinct aspects can be utilized properly for encouraging the
MicroGrids.
The relationship of MicroGrid with the distribution system
is also an important aspect of MicroGrid economics. The
operational constraints of MicroGrid economics might not be
similar to those of centralized power system economics. A real
time price signal for successful interface between customers
and distribution utilities can be provided in a MicroGrid. This
helps to achieve optimal use of resources by both MicroGrid
and distribution/utility-side grid.
There are various benchmarks available on the various operational aspects of different DG resources. The focus is now
on the challenges to be faced in dealing with the adoptability
of these DG/DERs in a MicroGrid. The biggest hurdle of
adoptability concern is the economic viability in selecting a
particular model/technology and implementing it with the intent of proliferating its continued usage for a sustainable future
growth. Hence, technical challenges and requirements need to
be addressed fully for their continuous usage. They include the
co-ordination issues of DG/DERs etc., and successful parallel
operation of MicroGrids with distribution networks. Mainly,
technical challenges can be dealt based on the study and
analysis of the existing MicroGrids all around the world, and
by using the amassed knowledge on power system operations
of large-scale grids. It is known that technical challenges of
MicroGrid operation can be linked to the economic issues.
Hence, it is required to apply the combination of basic
economics of optimal investment and available technologies in
the operation of MicroGrids. This points to an important issue
of “optimal technology investment”, where the established and
reliable tools are suitably applied. These definitely adds some
considerable improvement to the MicroGrid economics.
B. Emerging Economic Issues
Some of the emerging economic issues related to MicroGrids are identified and expected to play a significant role in
the near future. The issues like joint optimization of demand
and supply, joint optimization of heat and electric power
supply, more focus on quality and reliability, metering arrangement, connection charges, and tariff mechanisms incorporating
metering, profile and fixed charges for use of transmission
and distribution systems for export and import of energy, are
recently coming into the picture of MicroGrid economics and
are crucial to mould MicroGrids as public viable utilities.
Joint optimization of heat and electric power supply using
Combined Heat and Power systems (CHP) creates the potential
in MicroGrid system for improving the overall energy efficiency. This is a suitable option for countries with cold climatic
conditions to increase the viability options of MicroGrids. So,
developing and adopting the required low-cost technologies to
meet the requirements are needed.
In the market participation point of view, joint optimization
of demand and supply is one of the special features for
MicroGrid economics. Here, supply consists of imports from
the utility grid and exports from micro-generation of customer,
where as the demand is of customer load. The demand
and supply optimization will become easier in a MicroGrid
since the generator and the consumer is one and the same
decision maker. The important criterion of this optimization
is the marginal cost of self-generation at any point of time
as against the traditional load control algorithms like load
shedding, interruptible tariffs, demand side management etc.
The MicroGrid should know both its marginal cost of power
generation at any point of time and the equivalent costs of
investments in energy efficiency. Through this it can easily
decide the cost of curtailment for trading.
C. An Indian View
In developing countries like India, most people in remote
areas are not able to derive benefits of the ongoing electrification process. Since there is no power network available to
connect the isolated villages to the central or state grids, more
investments are needed. In this connection, the Government
had long before initiated the process of rural electrification
through renewables and other locally available distributed
generation resources. On the other hand, people in semi-urban
areas are not able to fully meet with their energy requirements.
For people in urban areas, the focus is on power quality and
reliability issues. This is due to the geographical diversity
and customer area priority levels set by the Government.
Owing to these demarcations, the theme of MicroGrids in
developing countries has a different perspective and broader
scope for discussion. In India, though there is an initiative for
the encouragement of MicroGrids there is still a long way to
go in overcoming certain hurdles. There is a strong regulatory
framework for encouraging the independent renewable energy
generation which constitutes the building blocks for MicroGrids. The current on-going rural electrification programs are
mainly with the renewable generation. Some of the identified
concerns which are predicted for the acceleration in the focus
on economics of MicroGrids in India are as follows:
1) Financial Concerns, Environmental Benefits and Cost
Recovery: A critical issue in DG/DERs for rural electrification is the cost recovery and the implementation mechanism.
Except small hydro, solar and wind power generation, other
technologies are not market proven. Hence, they put some risk
on the investment. In addition to the capital investment, the
auxiliaries like reactive power support, storage capacity, etc., to
maintain reliability and power quality of the supply, eventually
burden the process. However there are some relief processes
which hedge risk on the investments. A mathematical tool
named, EADER is developed in [7] for economic analysis of
stand-alone/grid-connected DG and MicroGrid. The EADER
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has been used to find optimal mix of wind, bagasse, and
natural gas based generation for a proposed MicroGrid at
Alam Prabhu Pathar, Maharashtra, India. For these isolated
MicroGrids in remote areas (rural), it is beneficial to link the
DG system to an industrial load (agricultural cold storage, oil
mill etc.) to improve its load factor and hence for enhancing
its economic viability options. There is a possibility for the
upcoming renewable generations to be registered under clean
development mechanism (CDM) projects of Kyoto Protocol.
62% of the projects under CDM from India are based on
renewable generation [12]. This strengthens the economic
viability options on going for renewable generations under
Microgrids. The Government has initiated the assessment of
CDM potential in all new green field power projects, and
accordingly instructed the nodal agencies like power finance
corporation, etc. Hence, all these happenings in developing
countries like India have opened up the possibilities for a faster
cost recovery.
With enabling technologies that transform the isolated mode
of operation into inter-connectivity with main grid (either
transmission or distribution), MicroGrids can “sell” excess
power to the utility grid. Costs decrease because of reduced energy storage, less downtime, equipment operating at maximum
efficiency, lower hardware expense and optimal power input
control based on energy costs. The flexibility accorded by this
arrangement can be beneficial. This also warrants research on
the ensuing cost-benefit analysis, taking into account all the
technical constraints.
2) Policy Making: In areas where there is no electricity
grid, there are minimum clearances/permissions required for
setting up a DG system. This will be continued for a welldefined period or up to a well-defined limit and encourages
in a way for outcomes and not just outlays. Different policy
experiments for implementation of DG in different regions are
under execution. The Indian Electricity Act, 2003 provides
the requisite framework for expediting electrification in rural
areas by permitting operation of standalone DG systems,
independent of the regulatory regime. Now, policy changes
to accommodate MicroGrids in different forms are needed.
The village panchayat aided by the state energy agency in
consultation with technical experts will decide the appropriate
technology option (biogas, bio-mass gasification, wind-diesel,
micro-hydel, bio-oil-engine) for the respective villages. Financial institutions are encouraged to setup venture capital funds
for energy entrepreneurs.
3) Ownership and Regulation Issues: Ownership is in
different forms. Different DGs in the MicroGrid can have
different owners, in which case several decisions may be
taken locally, making centralized control very difficult. But
as an independent MicroGrid, when coordinating with other
MicroGrids and the main grid, it requires a corresponding
centralized decision making process by prioritizing the DGs
individually. At this stage, the question of immediate concern
is, who may control what? [13]
For the MicroGrids to widely happen in communities (both
rural and urban areas) across the country, there needs to
be a fundamental change from the electric utility industry’s
traditional focus on supply-side technology and infrastruc-
ture. It requires demand-side technology and infrastructure.
To create a more consumer driven electricity system that is
accountable to the consumer and to create a truly sustainable economic stimulus based on entrepreneurial innovation,
it requires awareness among end-users/consumers and more
policies incorporating standards and market boundaries. This
will unlock the benefits of MicroGrids and invite innovation
and investment.
4) Tariff Structure: There is an attractive tariff structure for
renewable energy generation in India. Power regulators had
made incentive structures that encourage utilities to integrate
wind, small hydro, co-generation etc., into their systems.
Incentives have been provided to the energy generated as
opposed to the capacity created.
5) RE obligations and REC Mechanism: Recently, obligation to purchase renewable power has been made mandatory
in India by MNRE. Taking suitable measures for connectivity
with the grid and sale of electricity to anyone, and also
specifying a percentage of the total consumption of electricity
in the area of a distributing business for purchase of electricity
from such sources, have been mandated. According to Indian
Electricity Act, 2003, Section 86(1)(e), regulatory commission
should specify purchase obligation from renewable energy
sources. In this line, different state regulatory commissions had
made different RE purchase obligation percentages for a distribution licensee, captive consumers, open access consumers
and which is usually decided based on the RE generation
potential and other factors of the respective states. Now, India
has also taken wide steps to encourage the large amounts of
RE generation. To serve this purpose, MNRE has introduced
the Renewable Energy Certificate (REC) mechanism in India. RE generators with capacity untied in Power Purchase
Agreement (PPA) will have an option to sell electricity and
REC separately. The report on “conceptual framework of REC
mechanism in India” can be found in reference [14]. The
eligibility criteria for participating in this mechanism is for
RE technologies recognized by MNRE and grid connected RE
generators of at least 250 KW capacity. National load dispatch
centre (NLDC) will issue the RECs on intimating the RE injections by corresponding SLDCs. Power exchanges approved
by the central electricity regulatory commission (CERC) will
act as a medium for exchanging the REC certificates.
6) Government Subsidies [8], [15]: Subsidies for renewables may be justified on several grounds. A renewable
energy source is environmentally benign. It may be locally
available, making it possible to supply energy earlier than
when a centralized system can do. Capital subsidies available
for improving rural access have become uniform for both
remote and grid-connected villages/habitations [8], Ministry of
Power (MOP) [15] and MNREs are coordinating the outcomes
of Rajiv Gandhi Grameen Vidyutikaran Yojana (RGGVY),
MNRE rural electrification programme and the newly developed Village Energy Security program for development
of rural MicroGrids. Similar coordination is also called for
between the rural electrification programs, telecom and road
connectivity initiatives and certain social sector programs.
Bundling of services is likely to achieve greater access and is
more likely to yield sustainable structures that are replicable
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through separate franchises.
7) Fuel Requirement: Fuel requirement of a class of renewable technologies based on biogas, biomass and biofuel needs
investment upon the infrastructure to supply the fuel continuously. The infrastructure involves transportation facilities,
fuel storage, etc. Availability of these resources in the close
vicinity of the plant is highly desirable to reduce the fuel cost.
Reference [16] presents an optimization framework aimed
at reducing the fuel consumption rate of the system while
constraining it to fulfil the local energy demand (both electrical
and thermal). The solution of the optimization problem in
[16] strongly supports the idea of having a communication
infrastructure operating between the power sources.
When the concerns as elucidated above are addressed in
totality, in the long run, it would lead to an amorphous integration of various MicroGrids and the existing grid in India,
at which point the economic benefits become considerably
visible.
A. Advanced Fischer Tropsch Synthesis [17], [18]
D. Summary of economic benefits
The economic benefits of MicroGrids are manifold. In
summary, there would be significant reduction in transmission/distribution costing and losses, also improving energy
efficiency. Cumulative small scale individual investments of
end-users/customers would lead to lower capital cost of central
generations in near future and this may results in low-cost
entries to the market. Usage of micro-generation within the
neighbouring vicinity would make self sufficiency a priority,
subverting the need to export energy to the main public
network at lower prices. Further, there is additional security
and ancillary services provision guaranteed. In view of the
above benefits, along with the day by day increasing energy charges from conventional generating plant, the initial
higher investment costs can be justified. The various identified
technologies as explains in section IV may also enhance the
economic viability and efficient operation of MicroGrids. This
in turn makes the MicroGrid as public viable utility.
Some technologies to enhance the economic viability of the
MicroGrids are under development. One of them is the waste
heat generator (WHG). It converts geothermal and industrial
waste heat or pressure into emission free electricity. One of
the prototypes has employed 190 o C water to vaporize a low
condensing liquid in a closed system. It then uses the pressure
from that expanding gas to spin a turbine like device that drives
its generator. With a projection cost per kilowatt under $2,000,
a 20, 40, or 100 kW units will be able to pay for themselves
out of the energy cost savings in less than 3 years. In addition,
WHG can be placed local to heat sources, right on the plant
floor, saving piping costs and reducing heat loss. Some of these
units are available in the Indian market [21].
IV. E NABLING T ECHNOLOGIES TO E NHANCE E CONOMIC
VIABILITY AND E FFICIENT O PERATION OF M ICRO G RIDS
To build sustainable power system for future, it is essential
to bring the low-cost technologies which subscribe to lowered
initial investment cost and decreased operational costs to the
market. At the same time, they should also include enhanced
control strategies. These are necessary to bridge the gap
between local networks, and to create a modern infrastructure
with capabilities of integrating the DERs. Often it is very
difficult in every aspect to quantify the technologies in terms
of economics. However, an attempt is made in this section to
identify the various technologies which make MicroGrids feasible for future energy needs, in different aspects. The previous
section dealt with the various issues and challenges along with
the arguments related to the MicroGrid development in general
and also in an Indian view. This section describes the possible
solutions to overcome a few of the hurdles. The enabling
technologies for secure energy scenario, which also minimize
the investment and operational economics in the future are as
follows:
The Fischer-Tropsch (FT) process is a catalyzed chemical
reaction in which carbon monoxide and hydrogen are converted into liquid hydrocarbons of various forms. The principal
purpose of this process is to produce a synthetic petroleum
substitute, typically from coal or natural gas, for use as synthetic lubrication oil or as synthetic fuel. The procedure was
based on revisiting the basic chemistry at the molecular level
which has resulted in a powerful set of solutions for many of
today’s industries and sustainability challenges. Various feedstocks ranging from plant and animal biomass to petroleum
coke and heavy crudes can be processed in these systems to
produce a variety of synthetic fuels and other products. The
same refineries and distribution infrastructure would be able to
process and distribute this ultra clean transport fuel, fertilizer
or replacement for natural gas.
B. Waste Heat Generators [19], [20]
C. “Smart” switches, relays and sensors
Technical challenges include the design, acceptance, and
availability of low-cost technologies for MicroGrids. Several technologies under development, including MicroGrid
switches and advanced DG controls, allow the safe interconnection and use of MicroGrids. Power electronics based interconnection switches that can be used with a variety of DGs are
required to replace their outdated and inefficient predecessors
to allow the MicroGrid to manage and distribute power more
efficiently and reliably for becoming a smart microGrid. The
generic design of the control system allows the use of faster
power electronics. This power electronics interface can have
significant benefits compared with circuit breaker technology
because the system can be designed for seamless transfer
applications [22]. These interconnection switches are designed
to meet grid interconnection standards (IEEE 1547 and UL
1741 for North America) to minimize custom engineering,
site-specific approval processes, and lower cost.
D. Standards Development
The standards provide a common portfolio for a variety of
generation technologies. Absence of the standards slows down
the proliferation of various renewable energy technologies
available in a MicroGrid. IEEE P1547, IEEE 929-2000 and
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IEEE 519 standards are available for grid-connected DG/DER
systems [23], [24], which includes:
• Impacts of voltage, frequency, power quality,
• Inclusion of single point of common coupling (PCC) and
multiple PCCs,
• Protection schemes and modifications,
• Monitoring, information exchange and control,
• Understanding load requirements of the customer,
• Knowing the characteristics of the DG/DER,
• Identifying steady state and transient conditions,
• Understanding interactions between machines,
• Reserve margins, load shedding, demand response,
• Cold load pickup, additional equipment requirements, and
• Additional functionality associated with inverters.
Similar standards need to be developed for MicroGrids (isolated/grid connected or rural/urban) as well, which will help in
daily operation of such systems. Hence, large scale deployment
of MicroGrids should be supported by international standards,
and adopted worldwide.
E. Energy Storage Technologies and Storage Integration
The energy storage devices play an important role in enhancing energy production from the renewable energy technologies like wind and PV cell. The supply inconsistency
due to intermittency of weather conditions can be mitigated
up to some extent by providing backup from the energy
storage devices. Various energy storage technologies include
battery, flywheel, ultra-capacitor, superconducting magnetic
energy storage (SMES), pumped hydro, compressed air energy
storage (CAES), and hydrogen energy storage. Among these,
the battery technology is the most developed, and is well established for a variety of applications. The other forms of energy
storage are either still in the prototype stage of development
or are not suitable for mass production [25]. Since electricity
production from some of the renewable resources depends
upon weather conditions, use of storage devices will enhance
energy extraction. For instance, many wind plants produce
much of their energy when it is not needed, and solar plants
produce electricity based on daylight variations. The storage
of renewable energy would allow to dispatch the renewable
plants. The next issue presented centres on how to integrate
these technologies.
1) Virtual Power Plant (VPP): The Virtual Power Plant
allows us to remotely control and aggregate multiple energy
systems and storage devices. Actually, VPP is still in hypothesis stage and there is no unique definition for the framework
of VPP in the literature [26], [27]. Low inertial forces of
DG/DERs in a MicroGrid will reflect on the generationload balance adjustments. To overcome this, VPPs, creating
sufficient inertial forces may be employed for commercial
integration, which in turn increases the economic viability.
Market participation at peak demands increases revenues, thus
sending signals for sustainable options.
F. Information and Communication Technologies
The infrastructure development for the existing power
system and the information and communication technology
(ICT) are highly important to realize sustainable energy scenario [28]. European research has taken an initiative to realize
this need. The research aims to make the conventional power
systems more intelligent, self-managing, and self-healing. The
ICTs in this regard are capable of catering to many of the
functionalities of the future electricity network. Two successful
advanced ICTs are software agents and electronic markets [5].
Few of the important outcomes of ICTs are universal connectivity, services over the internet and web, increasing the
intelligence of the grid, advanced fault detection and handling,
and smart displaceable load options.
1) DER Co-ordination Architecture: A Way Forward: Due
to their modular generation, the DER co-ordination issues will
point to the decentralized control strategies. These require new
architectures for their implementation. In this respect, theories
presented to the research world are multi agent system (MAS)
approaches and their possible applications are being explored.
Many researchers are trying to apply MAS theories to find
possible solutions for MicroGrids operation.
These are important for enhancing the viability options
of the MicroGrids and inturn the effect can be seen in the
effective operation by increasing revenues and in the initial
investment cost recovery processes.
V. T OWARDS S MART M ICRO G RIDS : A C ASE S TUDY IN
I NDIA
India faces formidable challenges in meeting its energy
needs and in providing adequate energy of desired quality
in various forms in a sustainable manner and at competitive
prices.
A. ‘Smart’ MicroGrids
The term ‘Smart’ MicroGrid reflects a new way of thinking
about designing and building SmartGrids. Reference [29]
details the SmartGrid initiatives and deployment strategies for
the Indian scenario. There are some similarities between the
SmartGrids and smart MicroGrids. The scale, the types of
decision makers involved and the potential rate of growth are
different for both. SmartGrids are realized at the utility and national grid level, involving large transmission and distribution
lines, while smart MicroGrids are at the end-user side and
have faster implementation. Smart MicroGrids are to create
a perfect power system with smart technology, redundancy,
distributed generation and storage, cogeneration or combined
heat and power, and consumer control. This is to work
together with the bulk power grid or system as an integrated
whole to provide its consumers with maximum economic and
environmental benefits, reliability and efficiency. The smart
MicroGrid makes smart decisions about what clean energy
source to run at what times, links to smart appliances, and
regulates energy demand. It can optimize all of the above for
cost reductions, energy savings and CO 2 emission reductions.
The integration of multi MicroGrids at the distribution level
will complement the goals of smart grids.
Valence Energy to Develop First Smart MicroGrid in India [30]: This project is under contract with Palm Meadows,
7
a 330 premium home neighborhood developed by SA Habitat [30]. The MicroGrid solution will include smart home technology and an extensive smart meter platform that intelligently
connects 83 kW of solar power generation and 2 MW of diesel
generation and also offers power conditioning and demand
response. The system will ensure reliable and cost effective
power for the neighborhood, and limit the impact of grid power
failures.
VI. C ONCLUSIONS
MicroGrid is a prospective approach which integrates various distributed generation technologies into electricity distribution networks with known advantages like deferred network
expansion, improved voltage profile, reduced losses etc. The
benefits of interconnecting multiple systems can be realized
on smaller scale by a MicroGrid. India has just started their
effort in this direction with two small MicroGrids as described.
The economic analysis of MicroGrids at planning stage is
generally the function of various aspects like distance to grid,
fuel availability, choice of technologies, subsidies, and the
regulatory policies. The economics of operation would involve
optimal schedule with the diversified generation technologies
used for a particular MicroGrid. The key considerations for
success of MicroGrid are development and utilization of
safe and dependable communication infrastructure and control
strategies. The enabling technologies like SmartGrid will play
an important role in the success of MicroGrids.
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V. S. K. Murthy Balijepalli is currently a research scholar with the
Department of Electrical Engineering, Indian Institute of Technology Bombay,
India. His current research interests include Transmission System Expansion
Planning, data mining application to power systems, smart grids and governing
standards.
S. A. Khaparde (M’87-SM’91) is a Professor, Department of Electrical
Engineering, Indian Institute of Technology Bombay, India. He is a member of
the Advisory Committee of Maharashtra Electricity Regulatory Commission
(MERC). He is the editor of International Journal of Emerging Electric
Power Systems (IJEEPS). He has co-authored books titled, ”Computational
Methods for Large Sparse Power System Analysis: An Object Oriented
Approach,” and, ”Transformer Engineering: Design & Practice,” published by
Kluwer Academic Publishers and Marcel Dekker, respectively. His current
research areas include power system restructuring, distributed generation,
policy making and model building for emerging power markets.
C. V. Dobariya, is senior project engineer with the Department of Electrical
Engineering, Indian Institute of Technology Bombay, India. His current research interests include Transmission System pricing, Distributed generation.,
etc.