Techno-Economic Analysis of a Novel Optimization Method for Hybrid Diesel–PV–Battery Systems

In this study, a novel optimization framework was developed to minimize the Net Present Cost (NPC) of hybrid renewable energy systems under realistic Somali conditions. The study evaluated four configurations using hourly load, solar radiation, and temperature data: Diesel-only, Diesel/PV, PV/Battery, and Diesel/PV/Battery systems. The main objective was to identify the most techno-economically viable and environmentally sustainable option capable of supplying a commercial load with a 15.8 kW peak demand. The optimization was conducted in Python through a single-objective cost function constrained by system reliability, with a Loss of Power Supply Probability ≤ 0.05 and total capacity maintained between 21–25 kW. The analysis considered capital, replacement, and fuel costs with component lifetimes ranging from 10 to 20 years and a discount rate of 8%. The results indicated that the Diesel + PV + Battery configuration achieved the best overall performance, with an NPC of $286,746, LCOE of $0.296/kWh, reliability of 95.5%, and a renewable fraction of 74.6%, while reducing CO₂ emissions to 987 t. In comparison, the diesel-only system recorded the highest cost, with an NPC of USD 345,140 and emissions of about 1,338 t CO₂. The proposed optimization method demonstrates a practical and scalable approach for low-cost hybridization in resource-constrained regions, enhancing both economic efficiency and environmental sustainability of local microgrids.