Microgrids grow energy independence

By Robert Schwab, Editor PioneerHQ.com
Being energy independent by becoming your own distributor of electricity is an idea spreading among college campus administrators and the military — to the point that soldiers in Afghanistan are already creating their own battlefield microgrids, according to an expert who predicts a 164 percent growth in generation capacity for campus microgrids over the next six years.

Yet the U.S. commercial/industrial sector, which includes large and small businesses that could benefit from generating and distributing their own power, is the least active of five industry groups in the developing market for microgrids, which Peter Asmus, a San Francisco-based analyst for Boulder’s Pike Research, estimates will reach $777 million by 2017 for campus microgrids alone.

Commerical/industrial, especially small business, is “lagging a little bit” compared with other sectors’ investigations of the benefits of microgrids and distributed power generation, Asmus said. “They’re waiting for these [methods] to be validated,” he said.

I wrote about Pike Research on this blog a little more than a year ago, and find its spotlight on cleantech markets a fascinating look into the future of American business. It also suggests promising markets for small businesses hoping to become vendors and suppliers to the bigger players in cleantech industries. Or to become bigger players themselves.

Asmus said distributed energy — the local generation of power to serve onsite users, a long standing practice of college campuses using diesel fuel to generate power and now renewable sources like wind and solar — is still “a small piece of the energy portfolio,” but microgrids for distribution of such energy are increasingly considered adjunct enterprises to protect institutions from blackouts and sometimes to sell energy to create revenue.

“In the U.S.,” Asmus said, “utilities will pay people to go off their systems” during peak periods in order to preserve capacity for their own customers.

Military bases in the U.S. are especially sensitive to power outages and are seeking to create their own microgrids to avoid dependence on a supplier subject to shortages. Asmus said soldiers in Afghanistan are already using “mobile” grids they can set up out of backpacks in the field.

Asmus’ report suggests five groups of power users investigating greater use of microgrids: campus users (which includes business parks, college campuses, and large-company campuses); the military; remote users (mostly in developing countries that lack nationwide power grids for distribution); community/utilities (which are popular in Europe, especially in countries like Denmark which draws 25 percent of its total energy from wind); and finally commercial/industrial in the United States. He said some utilities in the U.S. are beginning to see the wisdom of creating microgrids for servicing customers off the national power grid.

Creating a microgrid is “relatively easy” when there is a single owner involved. Multiple owners of a grid, such as the many firms located in a business park, are more difficult to service and regulate.

By 2017, Asmus estimates installed generation capacity for microgrids will increase 164 percent from 620 megawatts to 1.6 gigawatts, with most of that coming from the campus sector worldwide.

This report was posted on The SchwabBlog Dec. 28, 2011. Robert Schwab is the editor of PioneerHQ.com; his blog focuses on small businesses but also covers other topics.

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