Microgrids Deliver Resiliency, Security and Savings
“A lot of companies might not be necessarily energy experts,” noted Asmus, “so it’s–‘Where do I begin, who do I trust?’–and there are so many different vendors out there.”
Installing a microgrid is clearly a major project, but it doesn’t necessarily mean an organization will have to purchase all new components. In many campus settings, some of the components of a potential microgrid are already in place, such as generating facilities or a management network. According to Asmus, “most microgrids are not greenfield projects—today most of them are retrofits.”
Microgrid implementers also have to parse their current energy usage and determine which parts of their facilities represent critical loads where power must be maintained under all circumstances. That’s because on-site power generation may be limited and unable to replace all the electricity normally drawn from the utility.
Benefits of a Microgrid
Beyond the primary benefits of resiliency under stressful conditions and greater security given islanding, microgrids also deliver other value.
With on-site power generation part of the picture, an organization can reduce their reliance on utility power and cut costs. In some cases, a microgrid’s local resource may produce excess power that can be sold back to the utility, even further reducing the organization’s energy costs. A microgrid may also help maintain use of utility power at a lower level to avoid peak usage charges.
With a network in place and overall management of components, organizations often find that they are better equipped to manage their energy consumption, which can further reduce costs.
Microgrids and Utilities
Given that most of the benefits of microgrids result in cost savings for the microgrid owners, it doesn’t seem like a situation that utilities would regard favorably. In addition to potentially losing money from reduced consumption, utilities also have to ensure that they can accommodate the bidirectional flow of energy as microgrids consume and create energy.
As a result, utilities were not enthusiastic when microgrids began to pop up. “Any time you have a customer generating their own power, the utility is losing sales,” observed Brandt.
But as interest in microgrids grow, utilities’ resistance to them has diminished, and some are trying to turn the potential of lost sales into a new profit stream. They’re doing so by becoming a willing partner and offering fee-based services to organizations for activities such as microgrid feasibility studies and designs.
Brandt notes that Xcel Energy is a case in point: “Here in Colorado, Xcel Energy recently filed a proposal for a resiliency pilot working with a number of communities in the area.”
A little farther west, Pacific Gas & Electric, Northern California’s principal energy purveyor, has proposed a system of microgrids to help segment its coverage and thus make it easier to manage power distribution and provide resilience in the face of destructive wildfires.
But for utilities to take a more active role in microgrid development, some adjustments to regulatory processes may be required to reduce the red tape and hasten deployments.
“A lot of the rules still date back to old monopolies’ way of doing business and the technologies is moving a lot faster than regulation,” Asmus said.