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Estimating Energy Costs Using a Markov Model for a Midwest Off-Grid Residence

The use of energy storage in conjunction with renewable energy sources such as wind and solar is receiving more attention to help mitigate the effects of the intermittent nature of these sources at off-grid residences. One wishes to maximize the probability that there will be enough energy available to meet the residential load demand while minimizing the cost of both the renewable energy sources as well as the energy storage device(s). In this paper, the energy storage required to ensure high reliability of supply to an off-grid residence in the Midwest is determined iteratively based on the amount of installed solar power. A Markov model is employed consisting of 288 state transition matrices to generate synthetic solar data for analysis. By accounting for the costs of both the photovoltaic system and the energy required energy storage, an optimal cost solution is provided.