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Why Smart Microgrids are Gaining Momentum

By Howard Baldwin, Contributing Columnist

For something with “micro” in its name, microgrids are becoming a pretty big deal. Microgrids are distributed, small-scale versions of the centralized conventional electricity grid systems.

According to an August 2013 report from research firm MarketsandMarkets, the total microgrid market is expected to grow at an estimated CAGR of 17% between 2012 and 2022, reaching a total installed capacity of 15.4 gigawatts by 2022 and a value of $27 billion.

But what’s their connection to the connected life? It turns out there are multiple connections, depending on how microgrids are used. Singly, they provide power to a confined area – think of them as a WiFi hotspot for energy.

Interconnected, they can provide power to a group of such areas – and do so in such a way that is familiar to any network engineer. If any one microgrid in a cluster fails, the others can continue to provide power, in the same way that knocking one node out of the Internet simply re-routes traffic through others for reliability.

Microgrids, then, are energy for the Internet age.

Three Kinds of Energy Connectivity

There are really three ways to categorize microgrids, says Paul A. Centolella, vice-president of the Analysis Group, a Boston-based economic, financial, and strategy consulting firm. “One could power an individual building to isolate itself from the power grid, but the more conventional definition involves a campus setting, where you have an internal distribution grid, a source of power within the grid, and the ability to isolate that network from the local utility,” he says.

The third category relates to the Internet model, based on the topology of the distribution network. “As you get systems that are more reliable and more resilient, integrating both distributed generation and storage of energy, you could see distribution networks that are interconnected microgrids. They would also be able to both operate independently to meet the needs of customers and to maintain relationships under stress conditions.”

In the latter configuration, of course, they relate to the so-called smart grid, which further ties into connectivity. “When I think about energy network distribution of the future, we’re talking about a cellular system that the distribution operator can reconfigure and integrate [at will]. The operator can send appropriate price signals both to generators and to users that allows them to operate the distribution network more efficiently and maintain service as reliably as possible.”

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Microgrid Early Adopters

Where organizations are installing microgrids runs the gamut from developing to developed countries. Most of San Diego-based General Microgrids’ work is international, according to CEO Terry Mohn, for rural electrification in countries such as Kenya and India. “We work with governments in places where the power infrastructure is very fragile,” he says, adding that the microgrids are powered by batteries or by solar power using photovoltaic arrays, “whatever is appropriate based on the natural resources of the village.”

“Rather than building power lines, we use the distribution control systems of the microgrids as a transmission resource,” says Mohn. “That gives us a bidirectional power flow so that when excess capacity exists, we can provide it as a resource to adjacent villages.” Mohn adds that the microgrids his company has installed are being used solely for energy relating to creating clean water and thus improving crop production, but not for connectivity.

In developed countries, however, microgrids could indeed be used for both energy and maintaining connectivity. Mohn cites potential adopters as “any geographical areas that are self-contained,” which he says could include campuses (academic or corporate), sports arenas, ports, industrial parks, and military installations.

Connecticut Leads in U.S. Municipal Deployments

Perhaps one of the biggest early adopters of microgrids from a municipal standpoint is the state of Connecticut. “We’ve been pounded by naturally occurring storms over the past two years, and we’ve had five major power outages in that time,” says Alex Kragie, deputy chief of staff in the state’s Department of Energy and Environmental Protection. “When that happens, the citizens bring out the pitchforks until they hear how expensive it is to put wires underground.”

Microgrids represent a middle ground. The state has launched a microgrid program in nine different municipalities. “Microgrids represent a scalable concept,” says Kragie, “but we’re dealing with clustered, tightly networked buildings. For instance, in Bridgeport, the police station, fire station, and senior center are all very close together. In Hartford, there’s a school, a senior center, a gas station, and a grocery store all clustered within a quarter-mile.”

The microgrids serving those geographies can help keep basic amenities available at entities such as banks, wastewater treatment plants, pharmacies, and public shelters, adds Kragie. “Our overall goal is to find a way of increasing the safety and quality-of-life of residents during an outage. If severe weather events become the new normal, we need to be better prepared with a larger resiliency strategy.”

Connecting to the Internet of Things

Unlike developing countries, microgrids could also be used to maintain connectivity. “You could maintain Internet access either wirelessly, or through wireline connections,” says Kragie. “The managers of each individual microgrid will decide how they can most effectively keep communications open.”

Microgrids are definitely part of the so-called Internet of Things “if you define it as the ability of intelligent devices to exchange information,” says Centolella, who recently spoke at a July 2013 Washington, D.C. conference entitled “National Town Meeting on Demand Response and Smart Grid”, which focused on the interconnection of smart grids and broadband. “At a rudimentary level, we’re talking about the information exchange that would occur between elements of the grid and the operators about the generation of distributed resources. That information exchange could evolve into a layered control architecture.”

One of his conference presentations, he noted, was about the ability to use the smart grid to analyze current and future pricing to determine when energy should be consumed for the best pricing. “This remains an active area for development,” he says, because “it’s not at all clear yet how this will evolve.”

The results may not be clear, but the journey will be intriguing. One of the challenges of generating electrical energy, of course, is energy generated but not used is lost. Imagine an intricate interconnection of intelligent networks that shift unused power to areas where it’s needed. That would be a whole different kind of Internet, and just as revolutionary as the first one.

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