Utilities find value in former problem market

According to a new report from Pike Research, the campus microgrid market is expected to reach $777 million by 2017.

Historically, utilities have stayed away from microgrids, with safety being a primary concern. If a microgrid went into "island" mode, they were afraid there might be some backflow of power back onto their grid, endangering line workers trying to restore power during an outage. Further, utilities have feared a loss of control over resources on the system, and perhaps customer loads.

New inverters have come on the market over the past five years and IEEE has issued protocols this year that address the issue of safety. Recent demand response rulings by FERC have transformed microgrids from a utility problem into a utility solution.

"Microgrids are eligible for these grid operator revenue streams, and can now, ironically enough, be paid to go into island mode during times of peak power demand," Pike Research Senior Analyst Peter Asmus told FierceEnergy. "The other advantage the microgrid brings to the table for utilities is aggregating renewable distributed generation -- solar PV, small wind, advanced storage and even plug-in hybrid electric vehicles -- into systems that are larger in scale and, therefore, more manageable to the host distribution utility."

Among the utilities seeing the value of microgrids are San Diego Gas & Electric (SDG&E), American Electric Power (AEP), Consolidated Edison (Con Edison) and B.C. Hydro.

SDG&E is sponsoring a 10 MW microgrid that is an isolated feeder line with significant customer-owned solar PV. The ability of this feeder line to island provides reliability and efficiency benefits to its system.

AEP is focused on storage, and is rolling out 80 residential solar PV/community energy storage microgrids, each 25 kW in size.

Con Edison sees value in encouraging distributed generation in New York City since it is virtually impossible to bring new power into this densely populated urban center through the transmission system. The utility, therefore, has allowed many smaller microgrids based on Tecogen's InVerde CHP units to create microgrids -- including a "beer pier" near the Brooklyn Bridge that is not even connected to its distribution grid.

Finally, B.C. Hydro is looking to remote microgrids to shrink diesel consumption at communities not currently connected to its grid, but who are customers that it still has an obligation to serve since it is a provincial government.

For more:
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