High load demand penalty cost reduction using photovoltaic systems

Abstract

Photovoltaic (PV) system is one of renewable energy source that is used widely in critical industry where power interruption is inevitable. Most of new High Voltage (HV) and Medium Voltage (MV) developed projects either in commercial and industrial sector received electricity supply from the utility but with high load declared to the utility rather than the actual usage due to the load estimation from consumer. The loads estimated by the consumer is higher than its actual demand because of the un-used and non-regular used loads such as Variable Refrigerant Flow (VRF) Air Conditioning system and Fire Protections System (FPS) which consume high power when operate. Hence, under Connected Load Charge (CLC) scheme governed by utility, the consumer will experience high penalty cost due to non-usage and non-regular loads as per declared. This project proposes a method to reduce the loads declared to the utility by using PV system as secondary electricity source serving the un-used and non-regular loads. This project will study and analyze the cash flow of the consumers under CLC scheme for over declaring the loads. Next, in order to prevent this CLC, a method to reduce the loads declared to the utility which is by using PV system as secondary electricity source serving the un-used and non-regular loads to prevent CLC will be obtain. Instead of generating electricity by the solar PV, this paper will also study the cost implication under NEM scheme since the excess electricity generated by PV which flow back to the grid will be used by neighbourhoods while the consumer will gain benefits due to this. The viability of the concept is assessed by modelling a 1.2 MW Medium Voltage commercial hostel building in east coast of Malaysia (Terengganu) using System Advisor Model (SAM) software. The idea of the concept is that by installing PV system for entire roof of this building, the power generated will compensate with priority of the non-regular and non used load which can lower the loads declare to the utility thus, replacing high demand loads in High Voltage (HV) into Low Voltage (LV) tariff which no longer subjected to CLC. The consumer then will no longer need to pay for the penalty cost instead they will reduce their monthly electricity cost under NEM scheme for the excess generated energy by the PV system especially in weekend and low demand hours that flows back into the grid. The work can be considered as significant due to the fact that the implementation of solar PV can reduce and completely remove the penalty cost incurred to the consumers and at the same time contributing to the return of investment.