What is a microgrid? In simple terms, it is a local network of diverse power sources, featuring a mixture of renewable energy, fossil fuels and batteries that can operate as a unified system for a relatively small network of consumers. they mitt be the only power in a community, but more likely they are running in parallel with the Grid, bestowing resilience on its owners, who might be selling their surplus to the Grid and buying from the Grid during times of greater demand.
If the wider utility grid goes down, these microgrids can create a little island of power, making sure the most vital operations for a business, utility or community stay powered up during major storms or other power outages.
The adoption rate of microgrids is expected to accelerate. They offer greater resilience, a high potential for integrating distributed renewable generation resources, and the ability to isolate themselves, when necessary, from the wider power grid–a capability known as islanding.
North America is currently the leading microgrid market representing over half of worldwide capacity.
The first U.S. state with a policy of promoting microgrids is Connecticut, which is responding to a pair of extreme weather events: Tropical Storm Irene in August 2011 and a rare blizzard that hit the East Coast in October 2011. Both events led to massive power outages. The State has authorized construction of up to 27 microgrid sites as of early 2013 — supported by an initial grant and loan program of $15 million.
These microgrids scare the utilities, and if they are successful, could spell their doom. They also represent a bottom-up approach to solving not only what the United Nations calls “energy poverty,” but the looming catastrophe of runaway global climate change.
The Sacramento Municipal Utility District has constructed a microgrid adjacent to its corporate headquarters, which would power up its emergency control room in the event of a rolling blackout. Every single military base in the United States is exploring the microgrid option, and they are now also being deployed in Afghanistan and ultimately in the 600 forward operating bases of the U.S. Department of Defense located in remote regions of the world.
Because the reliability of the U.S. power grid is going down, not up, it is the world’s leading market for microgrids today. Yet the biggest market over the long run is the developing world where there is no utility grid, or such existing grids are so unreliable – and expensive – that villagers and businesses would prefer to create their own mini-networks for electricity less dependent upon imported fossil fuels.
Roughly 400 million households – or approximately 40 percent of the population of developing countries – still do not have access to reliable electricity.
Incredibly enough, 550 million people out of the estimated 1.4 billion people without Utility power own a cellphone, which is why telecommunication towers have emerged as a leading choice for anchors to small microgrids serving rural villages. Banks are willing to finance the cell towers; entrepreneurs then figure out ways to extend electricity to nearby villages and small businesses. Often, the analogy is made that just like the developing world skipped telephone landlines to cellphones, the same is happening with electricity. Africa and other less-developed nations will go directly to microgrids, without the need for large nuclear reactors or coal plants connected to giant transmission lines.
Coincidentally, the declining prices for solar photovoltaic systems are the primary reason why microgrids are increasingly cost-effective, especially when compared to diesel fuel, the default fuel for most remote communities. The rise in mobile phone usage, and simultaneous decline in solar PV prices, is prompting many companies to take this cell phone analogy even further. Companies such as Mobisol of Germany use solar PV to supply power to off-grid cellphone towers. Villagers on bikes then transport batteries charged up by these towers for use at their own homes, another version of a distributed power system.
It has become increasingly clear that the fundamental architecture of today’s electricity grid, which is based on the idea of a top-down radial transmission system predicated on power flowing from large centralized power plants, is becoming obsolete. If, indeed, the electricity grid begins to resemble the Internet due to the proliferation of a variety of distributed electricity-consuming devices – including solar PV, small wind turbines, batteries and even electric vehicles – then a distributed network that can organize these devices into a coherent system such as the microgrid will become vital.
These and other trends are converging to create promising markets for microgrids in the United States and the Asia Pacific region, but ultimately offer the promise of genuine energy independence in Africa and the rest of the developing world.
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