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The Necker Island Story: Flagship Microgrid

 

There are few places on Earth with the abundance of renewable energy resources found in the islands of the Caribbean. As any resident or visitor of these islands knows, the region enjoys plentiful year-round sunshine and warm, steady winds, making the Caribbean not only an attractive vacation destination but also a natural fit to harness the power of renewable energy solutions.

 

And yet, with few exceptions, these islands have almost no indigenous fossil fuel resources, meaning each island must rely on constant over-water shipments of oil, diesel and other fuels for nearly its entire energy consumption, from transportation to electricity generation. The shipment, storage, handling and eventual use of these fuels are an incalculable detriment to the pristine environment that is critical to the tourism industry. What’s more, on nearly every Caribbean island, oil sets the incremental price of electricity, making retail electricity prices among the most expensive in the world and further hampering the region’s global competitiveness.

 

In short, using imported fossil fuels in small island nations is a crushing economic burden that can be avoided by tapping into the vast amount of renewable resources that are available locally.

 

When NRG Energy decided to participate in an RFP to develop a renewables-led microgrid for Necker Island, Sir Richard Branson’s private island, it raised a few eyebrows from onlookers and within NRG itself. Why would a project to provide an off-grid solution in the British Virgin Islands that generates a mere 500 kilowatts interest a company like NRG, the largest U.S. competitive power company with more than 53,000 megawatts of generating capacity? Why compete against more than 700 other bidders for such a small prize?

 

There were a number of reasons why the successful deployment of a microgrid for Necker Island is a key strategic priority for both NRG and for the entire region. As Sir Richard explains in the announcement of NRG’s selection: “The potential for more renewable energy across the world is huge, especially in places like the Caribbean, where islands offer an excellent test bed to demonstrate and scale innovative, clean energy solutions. While small compared to island nations, Necker Island is an ideal ‘guinea pig’ for the Carbon War Room’s Ten Island Challenge and will be able to show the potential of state-of-the-art technologies in renewable energy.”

 

We envision the Necker Island microgrid to serve as an iconic, flagship representation of the power of innovation, the promise of microgrids and the central role of renewable energy in tackling the Caribbean Basin’s energy challenges. A successful deployment on Necker Island has the potential to trigger an energy change that will affect not only the Caribbean, but also other island nations around the world.

 

With Necker Island, NRG also seeks to leverage and expand its leading solar and wind expertise, building on its innovative renewable energy installations at several professional football stadiums and its strong foundation as the third-largest renewables generator in the United States. NRG has also completed dozens of successful philanthropic solar installations in Haiti to help communities recover following the devastating 2010 earthquake. The direct impact of NRG’s investment in Haiti showed the world the kind of impact clean energy technology can have on people’s lives. With lower electricity costs, hospitals can buy more equipment and medicines, and schools can hire more teachers and buy much-needed supplies that facilitate better education.

 

Winning Necker Island was the first step to demonstrate NRG’s capabilities, not only as a charitable partner and a solar company, but as a 21st-century energy company prepared to enter into long-term power agreements in the region. Necker Island was the first challenge for NRG in developing the right solution for a unique customer, while at the same time demonstrating a way to reduce the impact of fossil fuel generation on the Caribbean Basin ecosystem.

 

The Caribbean also offers opportunities for NRG to compete in a new energy market using renewable generation technologies and work with island grid operators to develop technical solutions needed to deal with a high penetration of intermittent renewable energy. It helps NRG gain experience in how policy and regulatory issues are addressed as lower cost renewables enter the market. It allows NRG to work with bilateral and multilateral development banks in higher risk markets, developing competitive financing frameworks that can be replicated in larger markets where diesel or heavy fuel oil sets the price of electricity.

The energy business case in the Caribbean is as clear as the crystalline water of its beaches. Through properly designed and structured projects, renewable sources of energy are available today at a lower cost per kilowatt-hour than electricity generated using conventional fuel sources. A lower cost of energy at an islandwide or regional level has the potential to dramatically impact the economic competitiveness of the Caribbean.

 

Necker Island is allowing us to demonstrate that a cutting-edge, solar-wind-battery microgrid can deliver up to 75 percent of the island’s energy needs at a competitive cost, dramatically reducing the use of diesel fuel. To achieve this goal, NRG collaborated with leaders across the microgrid value chain, from experts brought in from Virgin and the Carbon War Room, to various supply partners — each committed to the shared vision of freeing island nations from a necessary reliance on imported fossil fuels.

 

To date, there have been few opportunities to develop renewables-led microgrids that are cost-effective and reliable. This has led to a steep technical learning curve, which has proven an inspiring challenge for the NRG team. And, as beautiful as the Caribbean may be, it’s a tough environment for energy equipment because of from corrosion, salt spray, lots of warm sunshine and, of course, the occasional big storm. This requires the use of regionally suitable equipment and robust designs that can withstand tropical weather over time. We continue to uncover new solutions to this challenging environment.

 

Widespread use of renewable energy in the Caribbean will require national and regional dialogues on policy and regulatory frameworks. Only by removing the roadblocks that hamper the rapid deployment of renewable power, such as long-term transmission planning, third-party ownership and the problem of stranded assets, will the region be able to fully unlock the potential of its bountiful clean energy resources.

 

Edouard MacGuffie is NRG vice president of solar business development in the Caribbean region. 

 

Source: http://www.energybiz.com/magazine/article/361389/necker-island-story



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