‘Plug and Play’
Other consumers, like Drew Barber of Petrolia, California, have deployed microgrids to cut ties to their power companies altogether. While cost is still a factor, the technology isn’t.
More than a decade ago “it required an electrical engineer to get you off the grid,” said Barber, who decided on a microgrid when he factored in the relative cost of bringing electrical lines to his remote Northern California neighborhood. These days, “it’s plug and play.”
Meanwhile, some developers are putting microgrids into new construction. In Sacramento, California, a 34-unit residential complex is being purpose-built with an integrated microgrid designed by Sunverge Energy Inc. The system will automatically switch residents to the cheapest power source, whether solar or conventional, while storing backup power for use if the grid goes down.
Recent power failures that have affected millions of customers help fuel demand for microgrids. Hurricane Sandy knocked out electricity for 8.5 million customers, showing just how vulnerable utility infrastructure is to storms. A 2006 heat wave across the U.S. caused 36 major power failures, including a blackout that left tens of thousands of Queens, New York, residents without power for a week.
A 2012 report by the American Society of Civil Engineers estimated that utilities need to raise cumulative spending by $763 billion by 2040 if the grid is to be properly modernized and hardened against natural disasters.
Indeed, Sandy proved a powerful endorsement of microgrids. While millions languished in the dark, microgrids at the FDA’s research center and Co-Op City, a 45,000-resident housing cooperative in Bronx, New York, kept the power flowing by disconnecting from the stricken grid and running in what’s called “island mode.”
“There is no question that microgrids breaking the grid down into smaller sections can prevent millions of people being knocked out of power by a major circuit going down,” said Honeywell’s Orzeske.
Besides blackout protection, Honeywell’s corporate and institutional customers are looking to offset rising conventional electricity rates -- retail power prices have climbed 34 percent since 2003, according to the Energy Information Administration.
The annual U.S. electric bill for businesses is around $200 billion. Lost business continuity from outages and power quality issues adds another $80 billion to $150 billion to the tab, according to data from the Lawrence Berkeley National Laboratory.
In response, U.S. commercial and industrial customers spend about $5 billion to $6 billion a year on self-generation and energy efficiency programs, increasingly employing microgrids to manage them.
“Our clients start out seeking maximum savings,” said Pullins. “But the difference between achieving maximum savings and grid independence is not that big of a leap in terms of capital costs.”
The U.C. San Diego microgrid, which has evolved into a mix of green and conventional energy from an early generator-backup system, provides a picture of the rationale.
“Our campus does $1 billion a year in research,” said Byron Washom, the university’s director of strategic energy initiatives. “We have an electron microscope that every time we have a supply disruption, it takes six weeks to recalibrate. We can’t let that happen.”
The conventional grid simply can’t provide that reliability, and all manner of institutions and companies that have “a high-reliability requirement” now understand that, he said. “Look at credit-card processors -- for every hour they can’t process it costs them money. That’s where the high-end, energy-intensive market for microgrids is going.”
And then there’s that $850,000 a month in cost savings, achieved because the campus is able to generate 92 percent of its own power. The microgrid manages a peak load demand of 42 megawatts with power produced from 1.5 megawatts of solar, a 2.8-megawatt fuel-cell generator powered by methane from a wastewater treatment plant, two 13.5-megawatt gas turbines and a 3-megawatt steam turbine. Any additional power needs are met through a contract with the local utility.
All this is managed by a cutting-edge microgrid controller made by San Diego-based Power Analytics Corp.
These savings aren’t an anomaly. The FDA estimates it’s already cutting about $11 million a year off its electric bill through both self-generation and the ability to sell power back to the grid -- savings that will rise to $25 million a year when an addition is completed in 2014.
“When you start layering in the ability to do that, there’s even better economic incentives to build a microgrid,” said Orzeske.
Microgrids also may be a solution for thousands of the world’s remote villages that subsist without electricity. The Washington-based nonprofit EarthSpark International has built a microgrid that runs off a diesel generator, bringing power for the first time to 54 inhabitants of the village of Les Anglais. It will soon add solar and backup storage to serve others in the village center.