I have been in the Microgrid business for about 7 years now and have been in the Utility Grid Modernization (Smart Grid) segment for well over 15 years. I gravitated towards microgrids because it made a lot of sense to me. The factors of smart, digital, communications, industrial automation and decentralization of energy just seemed to resonate with me. There is a certain logical force that says processes that are effectively automated are done so on a decentralized or distributed basis. Since our grid is so decentralized, it will never be effectively automated until we have more decisions being made, in real time, at the edge of the grid.
A microgrid is the result of an energy grid modernization effort which will take time and effort to implement at an installation (utility, community, industrial complex, military base, commercial campus, etc.). Microgrids generate a wide range of benefits for end users. This is mainly due to the enhanced location of the Distributed Energy Resources (DER’s), which are now located close to the point of consumption. The market demand is clearly growing, and so is the technology; however, the challenge is execution. Like other Smart Grid solutions, microgrids will continue to improve as new technologies are commercialized. End users who place a high value on continuous access sustainable energy, resilient systems, improvement in reliability, and overall increase in security should look closely at a microgrid solution.
Basically, what I just said was, “hey, these microgrids are here to stay, they can enhance your company or community, and if you’re interested, let’s talk”. However, whenever I am asked to develop a business strategy, to speak at a conference, or to lay out what it takes to build a microgrid, one of the first things I consider is: “Who’s the team we need to deploy to meet your project demands?”. As the saying goes, “it takes a village to raise a child”, I would apply a new saying for microgrids: “it takes a team to develop a microgrid”.
Why is this? Earlier I offered my take on what a microgrid is, but I glossed over many of the important details regarding integration. There is one primary factor which must be considered in this grid modernization effort, and that is bringing DER’s and the ability to generate electricity closer to the point of consumption. This change has us thinking differently about how we power a local community, and it seriously critiques how we did energy and power in the past. The days of backup generators and transfer switching are in question. Now they are being replaced with modern systems like renewable energy and battery storage, which provide prime power and are no longer used only as a means of backup. So, this means the backup generator may have to be a prime power natural gas generator, or maybe it’s a combined heat and power unit improving efficiency and adding new stacks of value to the community. We are now scratching the surface of a discussion on topics such as electricity, natural gas, heat, improved power quality. On top of this, I have also spoken about the power grid and how we need to make changes to it to properly route power during normal days and microgrid events.
The technical hurdles facing microgrids are known and complex but are ultimately solvable. If I reflect on my statement that it takes a team to develop a microgrid, then the team to deliver the microgrid must include individuals or companies who understand generation, power distribution, grid controls, safety, and communications. That covers the technical team, now let’s consider the financial side of things, or resources like natural gas, renewable energy, and battery storage. The aspect of adding generation assets to a grid is quite geographical, therefore the financiers need to understand whether there are further gains to ensure we aren’t wasting money. Next, we may need to look at the benefits to the community. How does this microgrid benefit the community during normal days, as well as in times of great need? In some cases, we can add more renewable generation into the microgrid, which can be pushed out to the local community for consumption. Or in a weather event which causes power loss, the utility can re-route switches to allow the microgrid to power emergency response facilities like fire stations, police stations, grocery stores, or gas stations. This allows these institutions to eliminate their backup (normally diesel) generators and reduce their capital and operational costs over time.
In closing, what’s the message I am trying to land? It boils down to this: sometimes you can’t do it all, and if you think you can, try to understand what you and your company is best at doing. Stick to your strengths and then find the right partner to cover the other technical, commercial, or financial roles. If you assemble the right team from the beginning, your microgrid project will come together in a much more successful manner.