Microgrids: Enabling Customers to Use the Grid in New Ways Instead of Leave it
Source: Microgrid Knowledge
- February 27, 2019
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Microgrids are an exciting technology that breaks down how the current monolithic grid system works and enables flexibility, customer choice, distributed renewable sources, and other advantages.
Much has been made about how microgrids can be used in emerging nations and island communities to build up a more robust and resilient electric power system compared with the entrenched grid system that exists in industrialized nations today. However, many are supporting the idea that building microgrid capabilities into the U.S. grid system today can bring with it a host of new benefits to customers and revolutionize the utility model. These are bold claims, so they're worth a survey and review:
At Parks Associates' annual Smart Energy Summit, RTO Insider reports on how energy efficiency expert Ken Wacks suggested utilities could embrace a new role as distribution service operator in the wake of a changing grid:
The distribution system has been static, but that is changing because distributed energy resources are proliferating at the edge of the grid. We think a DSO is an opportunity for utilities to make money from DERs by using the equipment that is already in place and letting the customer generate and sell energy via the distribution grid to the utility or other customers...Utilities have to figure out how to let customers use the grid, how to price the grid and how to use equipment on the grid. Some of these equipment items today can’t handle the backflow or excess energy, so that requires active management of the distribution grid and possible equipment upgrades. Intelligence in homes and buildings will help customers manage DERs and power flows to the utility or to other customers via the distribution grid,
Further, earlier this week came a piece from Microgrid Knowledge that details how the short-term effect of distributed energy resources (DERs) presents the risk that customers will increasingly go off-grid while only tapping the utility for occasional backup. However, the longer-term anticipation is that "by 2040 the prognosis changes. Electric vehicles (EVs) and electric heating -- both decarbonization efforts-- will boost utilities' peak demand by 63%." In this way, microgrids are creating one effect today (less reliance on utility generation) but will pave the way for a new business focus for utilities eventually (EVs and selling excess power back to the grid).
In that vein is the news story from the end of last week that MidAmerican Energy Company announces its support for legislation that advances renewable energy policy by supporting customer fairness. Specifically, this proposed Iowa legislation would eliminate the practice of shifting grid costs from those who can afford private solar to all other customers-- making those who have solar power pay for grid costs regardless of whether or not they are buying or selling power that month. This effect demonstrates the early ways utilities and legislators are keeping an eye on how distributed resources and microgrids will change the landscape and how that must be handled and modeled.
What does that outlook in the next 5, 10, 20 years look like regarding microgrids and how customers interact with it? Eager to hear your thoughts in the comments.