This research performed a techno-economic analysis of diesel-biogas hybrid microgrid system. The paper modeled, designed, and simulated the microgrid system using MAT-LAB/SIMULINK and performed system optimization using HOMER software. The anaerobic digestion (AD) processes were designed and simulated with the aid of Simulink to obtain the methane yield from the reactor. Results show that the methane yield is 95.04 kg/day at a reactor temperature of 55 • C. The synchronous generator was modeled and simulated for the application of both diesel fuel and biogas fuel system. The HOMER software was used to optimize the hybrid micro-grid system with the diesel system taken as the base case. Biogas production was varied between 1 and 5 tons while the calculated energy demand of the village was 271925 kWh. At a biomass production of 4 tons and above, the hybrid system became powered by only the biogas system for total energy production. The energy produced by biogas is 452820 kWh and a cost of energy (COE) of $0.0484. The net present cost (NPC) of the base case system is $1141292 while that of the hybrid system is $176600 and that of the biogas system is $170085 which shows the saving cost of 84.5% and 85.1%, respectively, compared to the base case system over the project lifetime.This is an open access article under the terms of the Creative Commons Attribution License, which permits use, distribution and reproduction in any medium, provided the original work is properly cited.

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