A hybrid pricing strategy for distributed generation using small hydel energy

Abstract

Absence of a generalized pricing method is one of the key issues with renewable energy generation. Each utility uses a different method for pricing energy. The proposed model gives a generalized method for determining energy price for generating companies, independent power producers, regulatory commissions etc. It incorporates both the economic and performance based factors in the pricing model. Also a penalty for deviation from scheduled energy, a new customer based reliability index and Clean Development Mechanism (CDM) benefit are included in the model. The study explores monthly water inflow and the monthly energy generation of a typical hydel energy generator of 24MW capacity operating in the state of Karnataka, India. The model developed is applied to this generator for determining the electricity price. The co-relation between energy price and technical and economic parameters is explored. A comparison between the electricity price from the proposed model and the levelized cost also is done.