Techno-economic analysis of a hybrid renewable energy system integrated with productive activities in an underdeveloped rural region of eastern Indonesia

The Southwest Maluku region in eastern Indonesia is considered a frontier, outermost and underdeveloped region. Its inhabitants live on isolated islands, including the residents of Mahaleta Village, where only 9.4% of the community have limited access to electricity. This study aimed to design an economically feasible hybrid renewable energy (RE) system based on solar and wind energy to integrate with the productive activities of the village. The study developed conceptual schemes to meet the demand for electricity from the residential, community, commercial and productive sectors of the village. The analysis was performed using a techno-economic approach. The hybrid system was designed using the HOMER Pro optimization function, and cold-storage and dryer systems were designed to support related productive activities. The optimized design of the hybrid RE system comprised 271.62 kW of solar photovoltaics, 80 kW of wind turbines and a 1-MWh lead–acid battery. We found that the hybrid RE system would only be economically feasible with a full-grant incentive and an electricity tariff of $0.0808/kWh. However, the productive activity schemes were all economically feasible, with a cold-storage cost of $0.035/kg and a drying cost of $0.082/kg. Integrating the hybrid RE system with productive activities can improve the economic feasibility of the energy system and create more jobs as well as increase income for the local community.