1. The Economics of Wind-Diesel Microgrids www.homerenergy.comwww.homerenergy.com2334 Broadway, Ste. B, Boulder, Co. 80302 Peter Lilienthal 2011 International Wind-Diesel Workshop Girdwood, Alaska March 10, 2011

2. The Future of Power Clean, distributed power with hybrid renewables and smart micro-grids 2334 Broadway, Ste. B, Boulder, Co. 80302

3. Clean Power Evolution Large utilities –Security obstacles –Regulatory obstacles Smaller systems –Liquid fuels from oil –High renewable penetrations Micro-grids with distributed controls for reliability and efficiency 2334 Broadway, Ste. B, Boulder, Co. 80302

4. Too Many Choices Solar Wind Biomass Hydro Geothermal Micro-turbines Fuel Cells New Storage Techs. Electric Vehicles Demand Response Load Management Smart grids Micro-grids 2334 Broadway, Ste. B, Boulder, Co. 80302

5. What is best? Depends on the application –Resources Especially variable and non-dispatchable renewables –Loads –Equipment prices –Equipment performance A confused mind says “No!” Requires a simple tool –Smaller projects cannot afford complex tools Modeling to grow the industry 2334 Broadway, Ste. B, Boulder, Co. 80302

6. Introducing HOMER Hybrid Optimization Model for Electric Renewables 1993: Developed at NREL for Village Power 1998: Released to public 2009: Spun off to HOMER Energy 2010: First commercial version 2011: Web-based version

7. System Architectures

8. Decision Support Framework Hourly Energy Balance Simulation Optimization Sensitivity Analysis

9. It Comes Down to Economics Saving oil is a more reliable business model than chasing subsidies 2334 Broadway, Ste. B, Boulder, Co. 80302

10. Sensitivity Which system is best under what conditions?

11. Penetration Contribution Analysis from HOMER High Medium Low No Wind 2334 Broadway, Ste. B, Boulder, Co. 80302

12. Foundation Costs 2334 Broadway, Ste. B, Boulder, Co. 80302 Total installed turbine cost $300,000  $600,000  $900,000 

13. Wind-Diesel Cogeneration What is the minimum fuel price for wind-diesel to be cost- effective? Does it depend on the size of the thermal load? Trade-off between waste heat from genset and dump load

14. Additional Insights The challenge of renewables is not what to do when the wind doesn’t blow. It is what to do when the wind blows too strongly A little bit of storage goes a long way The highest value of storage is not load shifting We could have saved billions of $s killing bad ideas quickly with more HOMER analysis 2334 Broadway, Ste. B, Boulder, Co. 80302

15. Results

16. Business Model Custom Training Leads Ads Data on user behavior

17. Customer Segments New users by month No connected grid –Islands –Remote applications Inadequate grid –Developing nations –Ultra-reliable applications –Micro-grids Smart grid –High renewable penetration –Storage –Electric vehicles 54,000 USERS 2334 Broadway, Ste. B, Boulder, Co. 80302

18. User Base Profile 193 countries 2334 Broadway, Ste. B, Boulder, Co. 80302 Status of global microgrid market Redesigning user surveys

19. Version 3 www.homerenergy.comwww.homerenergy.com2334 Broadway, Suite B, Boulder, Co. 80302

20. 2334 Broadway, Ste. B, Boulder, Co. 80302 Dr. Peter Lilienthal CEO peter@homerenergy.com (720) 565-4046 HOMEREnergy.com peter@homerenergy.com HOMEREnergy.com