Microgrids constitute an attractive solution for the electrification of areas where grid extension is not technically feasible or prohibitively expensive. In recent years, national governments have implemented various support policies to encourage the deployment of renewable energy systems (RES) and microgrid hybrid-powered systems. A fundamental aspect during the design and disposition of these types of units is the determination of the optimal configuration and sizing of each power generation component. Furthermore, the optimal design of microgrids is strongly dependent on technological parameters, local meteorological conditions, among other factors. In this context, this paper investigates the effects of different policy measures on the optimal configuration of microgrids functioning in islanded mode. A computable model is employed to carry out a set of sensitivity analyses and assess the impact of capital and fuel subsidies on the levelized cost of electricity of various systems. The model employed for this study minimizes the total life cycle costs (TLCC) over the 20-year lifetime of the microgrid project. Besides, as meteorological conditions are crucial parameters to consider while designing microgrids, a sensitivity analysis is conducted to examine the effect of wind speed and solar irradiation on the capacities of each distributed generation units. Our results indicate that capital subsidies, as well as fuel price variations, have a substantial effect on the final design of microgrid systems for rural electrification.

Hybrid energy systems (HESs) generate electricity from multiple energy sources that complement each other. Recently, due to the reduction in costs of photovoltaic (PV) modules and wind turbines, these types of systems have become economically competitive. In this study, a mathematical programming model is applied to evaluate the techno-economic feasibility of autonomous units located in two isolated areas of Ecuador: first, the province of Galapagos (subtropical island) and second, the province of Morona Santiago (Amazonian tropical forest). The two case studies suggest that HESs are potential solutions to reduce the dependence of rural villages on fossil fuels and viable mechanisms to bring electrical power to isolated communities in Ecuador. Our results reveal that not only from the economic but also from the environmental point of view, for the case of the Galapagos province, a hybrid energy system with a PV–wind–battery configuration and a levelized cost of energy (LCOE) equal to 0.36 $/kWh is the optimal energy supply system. For the case of Morona Santiago, a hybrid energy system with a PV–diesel–battery configuration and an LCOE equal to 0.37 $/kWh is the most suitable configuration to meet the load of a typical isolated community in Ecuador. The proposed optimization model can be used as a decision-support tool for evaluating the viability of autonomous HES projects at any other location.