Long Term Scheduling for Optimal Sizing

of Renewable Energy Sources for Hospitals

Shabnam Mahmoudzadeh Vaziri1 , Babak Rezaee1(B) ,

and Masoud Amel Monirian2
1
Faculty of Engineering, Industrial Engineering Department,
Ferdowsi University of Mashhad, Mashhad, Iran
babak rezaee@aut.ac.ir
2
Masoud Amel Monirian, Nian Electronic Company, Mashhad, Iran

Abstract. Energy use is on the rise due to population increment and

technology development. Generating electricity energy with fossil fuels
causes environmental problems; moreover, their cost is high because of
their depletion. For solving energy crisis and environmental problems,
alternative methods for energy generation should be considered such as
Renewable energy sources (RESs) which are considered as a promising
alternative for fossil fuels. On the other hand, hospitals are one of the
major consumers of energy. Energy costs consist a large amount of hospi-
tals’ costs; therefore, hospitals aim to minimize these costs owing to com-
petition among health centers. The objective of this paper is to propose a
long term scheduling model for the optimal sizing of the RESs among can-
didate technologies to meet the hospital’s demand while minimizing the
costs and maintaining reliability subject to economic and technical con-
straints. The model is run with real data from a hospital in Iran.

Keywords: Long term scheduling · Optimal sizing · Renewable energy

sources · Hospitals

1 Introduction
Energy use has increased in last decades due to population and per capita usage
increment. Due to fossil fuel sources depletion, importance of environmental
issues and decrease in carbon emission, the energy crisis is on the rise. According
to the energy crisis, most of the countries intend to generate energy with alterna-
tive sources and change their energy portfolio. Renewable energy sources (RESs)
can reduce green gas emissions and environment pollution; therefore, they are
proper alternatives for current generation method, and some researches focused
on optimal sizing of RESs with different constraints. Moradi et al. [5] considered
renewable energy sources as a reliable source of electricity. In this paper, they
used Net Present Value (NPV) as an economic factor to determine type and
capacity of sources. Sharafi and Tarek [8] presented a multi-objective model for
determining the optimal size of renewable energy sources. They used ε-constraint
c Springer International Publishing AG 2018
J. Xu et al. (eds.), Proceedings of the Eleventh International Conference
on Management Science and Engineering Management, Lecture Notes
on Multidisciplinary Industrial Engineering, DOI 10.1007/978-3-319-59280-0 112
 Long Term Scheduling for Optimal Sizing of Renewable Energy Sources 1343

method to minimize total cost, fuel emission, and unmet load. Yamada and Raji
[2] presented a model for determining the size of wind turbines, batteries, and
solar panels. The goal of their paper was to minimize the costs in three years time
horizon. Energy balance constraints, battery constraints, inverter model and load
model constraints were considered in the paper. Abd-el-Motaleb and Bekdach
[1] proposed stochastic model for optimizing size of wind turbines and energy
storage units. They considered energy balance constraints, storage constraints,
and also reliability constraints. Theo et al. [9] presented a linear optimization
model for a hybrid power system in order to minimize net present value of costs.
They chose wind turbines, solar panels and battery in an eco-industrial park as
a case study.
Health centers and hospitals are one of the major consumers of electricity,
where is necessary to generate energy in a continuous way and without black-
outs. Health care forms a significant cost for governments; however, thanks to
energy development, health care costs can be reduced [12]. Health care systems
are evolving rapidly, and the number of patients is increasing due to emergence
of new diseases and aging in society. Consequently, using modern medical equip-
ment and patient increment cause to the rise in energy use. The number of health
centers is increasing, and they evolved as a business industry because their com-
petition increases. In competition market, patients have to pay parts of the costs,
so health centers intend to decrease their costs as far as possible. Since hospitals
consist 31% of health care costs, hospitals are considered in this paper. One way
for reducing costs in hospitals is installation of RESs for energy generation [11].
Many countries allocate incentives to motivate investors for using RESs. There-
fore, hospitals can use government’s subsidy for supporting renewable energy
sources. In this paper, hospitals are considered as energy consumers. Although
supplying efficient energy is essential in hospitals, there are few researches on
energy use in hospitals. Some scholars research about heating and cooling sys-
tems in hospitals [3,6]. Mavrotas et al. [4] developed a bi-objective model for
minimizing costs and maximizing demand satisfaction. The technologies consid-
ered in their model were combined heat and power unit for providing power and
heat, an absorption unit and/or a compression unit for providing a cooling load.
Other papers focused on proper equipment selection in hospitals are [7,13].
The goal of this article is to determine optimal sizing of RESs in order
to minimize the costs and conserve reliability. The paper is organized as fol-
lows. Section 2 proposes problem definition and mathematical model. Section 3
presents the numerical example, analyses results, and discusses sensitivity analy-
sis. Finally, a conclusion is presented in Sect. 4.

2 Problem Definition

Since a significant amount of costs in a hospital is related to energy costs, careful

energy planning is of a special importance in hospitals. In order to minimize the
costs and reduce greenhouse gas emissions, hospitals can use renewable energy
1344 S.M. Vaziri et al.

sources. Due to the importance of environmental issues, and consumer moti-

vates for using RESs, governments consider some incentives for consumers pro-
ducing renewable energies. Renewable energy sources are dependent on the nat-
ural situation for generation, and they are unpredictable; consequently, one way
to increase their generation reliability is to use two or more renewable sources
simultaneously [10]. For increasing generation reliability, wind turbines and solar
panels are used in this paper, which means that hospital, according to its budget,
can invest in solar panels and wind turbines for energy generation. Some part of
required energy can be produced by RESs in this paper, and other parts are sup-
plied by the grid. Moreover, the hospital can sell its extra produced energy to the
grid. Economic factors such as inflation rate and interest rate affect decisions, so
aforementioned factors are considered in this model by using NPV method for
calculating objective function. The purpose of the model is to minimize invest-
ment costs in a specific period while maintaining RESs system’s reliability. By
solving the model, questions like the optimal size of wind turbines and solar
panels and the optimum time for investment are answered.
Some assumptions are considered for the mathematical model as follows:

• The planning horizon is ten years which is divided into 120 months.
• According to geographic location, the hospital can invest in wind and solar
energy.
• The hospital is connected to the main grid. Purchased energy price from the
grid is varied in different time slots.
• Extra generated energy by RESs is sold to the grid with fixed price.
• Simultaneous buying energy from the grid and selling energy to the grid are
not allowed.
• The investment cost of RESs is varied in time slots which is increased or
decreased by the inflation rate.
• Interest rate and inflation rate are known and stable.
• The specific amount of money is considered as a budget for each time slot.
The extra budget does not transfer to next time slot.
• Since the goal of the hospital is to focus on medical problems, the allocated
area for installing RESs is limited.
• It is assumed that renewable energy sources use different rate of their capacity
in each time slot (βs, βw).
• In each time slot, minimum amount of energy has to be purchased from the
grid to be used in emergency situations.
• For motivating hospitals to invest in renewable energy sources, government
pays a% of sources investment cost.

To model the problem, the following notations are defined:

Indices:
t : Planning horizon (month) t = 1, 2, · · · , T .
 Long Term Scheduling for Optimal Sizing of Renewable Energy Sources 1345

Parameters:
cap : Capacity of 1 kW of solar panels and wind turbines in a month;
βst : Utilization percentage of 1 kW of solar panels at time t;
βwt : Utilization percentage of 1 kW of wind turbines at time t;
f s : Required area for installing 1 kW solar panel (Square meters);
f w : Required area for installing 1 kW wind turbine (Square meters);
Fs : Total area for solar panels (Square meters);
Fw : Total area for wind turbines (Square meters);
dt : Energy demand of hospital at time t;
rt : Reliability at time t;
smax : Maximum amount of allowable energy which can be bought from the grid;
zmax : Maximum amount of allowable energy which can be sold to the grid;
ps : Investment cost of 1 kW solar panel;
pms : Maintenance cost of 1 kW solar panel;
pw : Investment cost of 1 kW wind turbine;
pmw : Maintenance cost of 1 kW wind turbine;
ct : Cost of buying energy from the grid at time (cent);
w : Price of selling energy to the grid (cent);
It : Budget at time t;
ss : Energy bought for emergency situations;
μ : Interest rate in a month;
α : Inflation rate in a month;
a : Government subsidy.
Decision Variables:
xt : Installed capacity of solar panels at time t (kW);
yt : Installed capacity of wind turbines at time t (kW);
zt : Amount of energy bought from the grid at time t (kW);
st : Amount of energy sold to the grid at time t (kW);
ut : Binary variable (1 if energy has sold to the grid).
Scheduling model intends to determine optimal sizing of RESs during 10 years
time horizon as follows,
T

 (ps + pms )(1 − a)(1 + α) xt
t t
(pw + pmw )(1 − a)(1 + α) yt
min t + t (1)
t=1 (1 + μ) (1 + μ)

ct (zt + ss) wst
+ t − t
(1 + μ) (1 + μ)

Subject to
t
 t

βst × cap × xj + βwt × cap × yj + zt − st = dt , ∀t (2)
j=1 j=1
t t
(ps + pms )(1 + α) xt + (pw + pmw )(1 + α) yt + ct (zt + ss) − w × st ≤ It , ∀t
(3)
1346 S.M. Vaziri et al.

T

f s × xt ≤ Fs (4)
t=1
T

f w × y t ≤ Fw (5)
t=1
st ≤ smax × ut , ∀t (6)
zt ≤ zmax (1 − ut ) , ∀t (7)
t t
dt − βst × cap × j=1 xj − βwt × cap × j=1 yj + st
≤ (1 − rt ), ∀t (8)
dt
xt , yt ≥ 0, integer, ∀t (9)
zt , st ≥ 0, ∀t (10)
ut ∈ {0, 1} , ∀t. (11)
The objective function is minimizing the cost of supplying energy from renew-
able sources and grid. The two first expressions calculate the investment and
maintenance cost of the wind and solar energy sources by considering interest
rate and inflation rate. The third expression shows the cost of buying energy
from the grid, and the last one expresses hospital’s income from selling energy
to the grid.
Since supplying reliable energy is essential in hospitals, all the demand should
be met which is presented in constraint (2). Constraint (3) represents the limi-
tation of hospital’s budget in each time slot. Area limitation for installing solar
panels and wind turbines have been avouched by constraints (4) and (5), respec-
tively. In each time slot, it is not possible to buy energy from the grid and sell
energy to the grid simultaneously, which have been determined in constraints
(6) and (7). Constraint (8) represents renewable energy sources’ reliability. In
this equation, the left expression shows the amount of energy which has been
purchased from the grid which should be less than a specific amount. Constraints
(9)–(11) indicates variable types.

3 Numerical Example
To show the performance of the model, it is solved for a hospital in Iran. The
numerical example is carried out by using IBM ILOG CPLEX Optimizer v12.3.
As mentioned, the goal of this model is to find the optimal size of renewable energy
sources (RESs) installed in the hospital during the ten years time horizon. For
reducing forecasting errors, years are divided into months time slots (120 time
slots). Hospital’s monthly demand and budget are estimated during meetings with
its experts. Some of the data used in the model are shown in Table 1.
The results are shown in Fig. 1. With scrutiny, it is obvious that investment
is higher in first time slots. It is reasonable due to the positive inflation rate.
Moreover, investments in solar panels are more than wind turbines owing to the
fact that they have more productivity in the aforementioned hospital, and also
they need fewer investment costs.
 Long Term Scheduling for Optimal Sizing of Renewable Energy Sources 1347

Table 1. Data related to time slots

Time d(kW) I (dollars) βs βw

1 12000 50000 0.5 0.23
2 12000 50000 0.6 0.3
.. .. .. .. ..
. . . . .
120 15000 8750 0.25 0.3

Fig. 1. Installed kW of wind turbines and solar panels in each year

Total solar panels which will be installed during ten years is 56 kW and
installed wind turbines are 9 kW.
Sensitivity analysis is done for effective parameters on model such as inflation
rate, interest rate, demand, reliability and etc. Some of them which are more
important are elaborated in this paper.
In the aforementioned hospital, a high amount of budget is allocated to the
first time slot because the decision for investment is given in this time slot. It is
assumed that the budget is allocated to the hospital in the sixth time slot or at
the beginning of the second year (13th time slot) with considering its interest.
According to results, which is showed in Table 2, if the interest rate is between
15 and 20%, it is better to allocate budget in the first time slot. If the interest
rate is between 20 and 24%, it is better to allocate budget in the 6th time slot.

Table 2. Inflation rate sensitivity analysis

Capital allocating method Capital Capital Capital

allocation in the allocation by allocation by
first period considering its considering its
profit in the profit in the
sixth month second year
Objective Inflation rate = 15% 80226 82562 83379
function Inflation rate = 20% 67324 64824 67849
1348 S.M. Vaziri et al.

Table 3. Purchased price sensitivity analysis

40% 20% Current 20% 40% 250%

decrease decrease price increase increase increase
in price in price in price in price in price
Solar 56 56 56 56 56 56
panels kW
Wind 9 9 9 9 9 9
turbines
kW
Amount of 96460 90828 89744 88544 87416 53020
purchased
energy from
the grid

Fig. 2. Installed kW of wind turbines and solar panels in each year

When purchased price is increased, it is expected that investment in RESs is

increased too. However, other scenarios can be happened due to other parame-
ters. For example, it is possible that the number of RESs is decreased or even
stay stable, but the time of investment is changing in these scenarios. Accord-
ing to results, shown in Table 3, with increment or decrease in purchased price,
number of installed RESs is stable, and the time of investment is just changed.
For understanding such changes, variations of investment time for current price
and 250% price increment are shown in Fig. 2 for ten time slots. With current
price, investment in wind turbines is started from 66th time slot; however, if pur-
chased energy increases 250%, investment in wind turbines starts from 9th time
slot, which causes to take advantage of wind generation in 57 more time slots.
Energy price is low in Iran; however, in developed countries such price is a
significant amount. As a result, we compared current price in Iran with current
price in United States, which is about 250% higher than energy price in Iran.
 Long Term Scheduling for Optimal Sizing of Renewable Energy Sources 1349

Table 4. Wind turbine utilization percentage sensitivity analysis

30% 20% 10% Current 10% 20% 30%

increase wind wind utiliza- wind wind wind
in wind turbines turbines tion turbines turbines turbines
turbines utiliza- utiliza- percent- utiliza- utiliza- utiliza-
utiliza- tion tion age tion tion tion
tion percent- percent- percent- percent- percent-
percent- age age age age age
age
Solar kW 48 48 51 56 57 60 61
panels
Wind 12 13 12 9 9 7 7
turbines
kW

Table 5. Wind turbine utilization percentage sensitivity analysis

20% increase 10% increase Current 10% decrease 20% decrease

in solar in solar utilization in solar in solar
panels panels percent- panels panels
utilization utilization age utilization utilization
percentage percentage percentage percentage
Solar panels 52 53 56 57 64
kW
Wind 4 7 9 13 13
turbines kW

Table 4 shows sensitivity analysis for wind turbine utilization percentage.

When wind turbine utilization percentage increases, investment in solar panels
decreases, and investment in wind turbines increases. Whatever the wind turbine
utilization percentage increases, there is less need for wind turbines. With wind
turbine utilization percentage reduction, the number of solar panels increases.
Table 5 presents sensitivity analysis for solar panels utilization percentage. By
increment in solar panels utilization percentage, amount of installed kW of wind
turbines decrease. Moreover, there is less need to install solar panels owing to the
fact that more demand will be met by less solar panels with higher utilization
percentage. On the other hand, by decrease in solar panels utilization percentage,
the number of wind turbines increases as far as area constraint permits.

4 Conclusion
In this paper, long term scheduling model was presented for determining optimal
sizing of renewable energy sources in hospitals. The model aimed at minimizing
costs while maintaining reliability according to specific constraints in hospitals
1350 S.M. Vaziri et al.

such as area limitation and budget constraint. By solving the model with real
data of the hospital in Iran, the model can reduce 10% of costs comparing with
the time when energy is only purchased from the grid. In presented model,
planning horizon was divided into monthly time slots which caused an increment
in forecasting errors. For further researches, authors can deal with daily or weekly
data. Also in this model, the price of required field for installing wind turbines
and solar panels was not considered. Authors can investigate the effect of field
price on model outputs.

Acknowledgements. The authors would like to acknowledge Professor Mitsuo Gen

for his scientific support.

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