Economic and Environmental Comparison of a Natural Gas Plant and Solar PV Systems for Rural Electrification in Nigeria: A Case Study of Iyiora Anam

Abstract

Electricity access rate in Nigeria have been all time low with 70% of rural dwellers lacking access to electricity, despite policies aimed at providing electricity to these off-grid communities. Therefore, in a bid to provide electricity access to Iyiora Anam, a rural off-grid community in Nigeria and ensuring that carbon emissions into the environment are accounted for, this study provides an economic and environmental comparison of a Natural gas plant and Solar PV systems utilising a mini-grid system. The study adopted the Theoretical framework of the Levelized Cost of Energy employing data gotten from analysis of the literature, survey approach and Off-grid RE developers and Equipment suppliers which was analysed using Homer Pro software for simulating different systems for micro-grid and other distributed electrical power systems. The results of the analysis show that Solar PV has a lower levelized cost but a higher Capital cost 90% higher than the Natural gas plant which has a lower capital cost but a higher levelized cost of electricity. When emission cost were modelled into the Natural gas powered system, its levelized cost increased further to show the uncompensated impact generating electricity with Natural gas. Also, the result of the sensitivity analysis to assess the likely effect variations in some parameters like fuel cost, emission charges and annual average solar irradiance will have on the cost of electricity generation on the site shows that fuel price and cost of electricity generation have a positive relationship, also emission charges and the cost of generating electricity exhibited a positive relationship. However, the annual average solar irradiance were discovered to have varying relationship with cost of electricity generation, as higher or lower average solar irradiance reduces the performance of the Solar PV system thus leading to a higher cost of electricity generation. The study recommends the need to develop policies which will further ensure that power system components (Panels, Batteries and Inverters) are subsidised so as to enable private investors have confidence in investing their funds in the off-grid areas especially for solar which have a high capital cost.