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Replacing diesel generation


Basics #

Question What actions and/or policies can encourage large-scale deployment of commercially viable renewable energy sources to replace stationary diesel generators?

Contest main page Submit proposals at https://www.climatecolab.org/web/guest/plans/-/plans/contestId/24

Deadline June 15, 2013, at 11:59 Eastern Standard Time

Rules All entrants must agree to the 2012-13 contest rules.

Prizes The contest winners will be invited to present their work at the Crowds and Climate Conference at MIT November 6-7, 2013, and at the event, a $10,000 Grand Prize will be awarded to one of the contest winners

Related contestsElectric power sectorScaling renewables in major emerging economies

Guidelines from the contest Advisor(s) and Fellow(s) #

Opportunity/Challenge #

The replacement of decentralized diesel energy generators with cleaner renewable alternatives presents an opportunity for decarbonization of a power supply that is used extensively in developing countries.

Decentralized diesel generators are a major source of power supply in Asia, Africa and island communities, where many areas either lack access to the power grid or suffer from frequent blackouts due to poor energy infrastructure. Additionally, industrial sectors such as telecommunication and oil & gas in developing countries have operations in regions not connected by the grid and thus deploy a large number of stationary diesel generators to supply power.

Diesel exhausts from these stationary generators contain Nitrogen Oxides (NOx), Carbon Monoxide (CO), Carbon Dioxide (CO2), carcinogens and particulate matter that are major source of air pollution. Besides air pollution, communities dependent on diesel generators are exposed to diesel price volatility and high operational and transportation costs.

Alternative solutions to decentralized diesel generation that have been implemented with success in the past include solar-PV hybrid plants, bio-gasifiers, solar-wind hybrid systems and community micro-hydro plants. Historically, reasons for limited penetration of these cleaner alternatives have included relatively high cost of renewable energy technologies, additional storage requirements and funding gaps in developing nations.

In recent years, rising prices for diesel fuel and the lowering cost of replacement renewable energy technologies have improved the commercial viability of renewable alternatives. For example, McKinsey estimates diesel costs range from 30 cents to 65 cents per kilowatt hour (kWh) in developing countries, while small-scale renewable energy can reach prices at a cost range of 12 to 35 cents per kWh, beating out diesel in many applications; however, the fixed cost of storage requirements adds to the implementation cost of power generation, making the upfront transition costs prohibitively expensive for many communities.

A balanced approach should re-purpose existing government fuel subsidies, while fostering private sector participation that can help address short-term alternative energy replacement financing needs, while also ensuring the longer-term viability of low-carbon markets.

Key issues #

The contest seeks proposals describing how diesel generators could be replaced by cleaner renewable alternatives.

All proposals will have to directly answer four fundamental questions:

  1. Who are the stakeholders involved? (i.e. who will implement this proposal and who will be affected?)
  2. What proven technologies can be used to minimize "technology risk" in deployment?
  3. How is the plan scalable and replicable? (i.e. how can this segment rapidly play its part in the 5.1 percent decrease in carbon intensity that Price Waterhouse Coopers projects is necessary by 2050; exactly what is possible by 2020?)
  4. How would this be a good investment for mainstream institutional/ retail investors?
    1. Credit counterparty risk
    2. Technology risk
    3. Operations and maintenance risk
    4. Other risks?

Judges and Contest-Specific Prizes

This Contest will be judged by a panel of three judges:

1. Lead Judge & Contest Adviser: Jigar Shah

Mr. Shah is a renowned entrepreneur and visionary committed to leveraging the next economy, or "impact economy," by solving the challenging issues of our time. Currently a Partner with investment firm Inerjys, Jigar is pioneering a new investment model that provides both growth equity and project finance to clean technology companies. Full biography

2. Supporting Judge: David Schwartz

Mr. Schwartz currently is a Senior Associate at the Carbon War Room, which he joined at its inception. The Carbon War Room is an initiative launched by Sir Richard Branson that focuses on finding viable and profitable business opportunities in reducing carbon emissions. David currently leads Carbon War Room's Network Engagement team. In his role, David engages with external stakeholders to incubate roadmaps that accelerate the deployment of clean technology solutions.

3. Supporting Judge: Vy Manthripragada

Ms. Manthripragada currently is a Program manager with KMR Infrastructure, a company engaged in the displacing of diesel generators with distributed renewable energy solutions. Previously she has worked as a Program Officer in the Office of the Secretary of the U.S. Department of State and a Senior Consultant at the US Department of Transportation. She also served as an advisor to a microfinance organization in India, and worked as Manager of Operations at the Advisory Board Company, a Washington D.C.-based healthcare consultancy.

References #