A Framework for the Evaluation of the Cost and Benefits of Microgrids

A Microgrid is recognized as an innovative technology to help integrate renewables into distribution systems and to provide additional benefits to a variety of stakeholders, such as offsetting infrastructure investments and improving the reliability of the local system. However, these systems require additional investments for control infrastructure, and as such, additional costs and the anticipated benefits need to be quantified in order to determine whether the investment is economically feasible. This paper proposes a methodology for systematizing and representing benefits and their interrelationships based on the UML Use Case paradigm, which allows complex systems to be represented in a concise, elegant format. This methodology is demonstrated by determining the economic feasibility of a Microgrid and Distributed Generation installed on a typical Canadian rural distribution system model as a case study. The study attempts to minimize the cost of energy served to the community, considering the fixed costs associated with Microgrids and Distributed Generation, and suggests benefits to a variety of stakeholders.