Making Modern Microgrids Work

Microgrids are trending nowadays, and it’s easy to see why. Between the hurricane-induced power outages this past summer and the rise of small-scale energy resources such as solar arrays and batteries, people are planning for dramatic transformations in the way we produce and consume energy. Many experts are turning to the microgrid as a key agent of this transformation.

Microgrids are small-scale, self-sustaining power networks unburdened by ties to a centralized power plant. But separation from the grid should not equate to total disconnection. If you’re thinking of “going off the grid,” it’s important to tap into the latest digital technologies—resource connectors to collect and process data—to make a microgrid a worthwhile investment.

Today’s high proliferation of distributed energy resources (DERs) often makes microgrids more complex than in the past. For example, a modern microgrid might comprise of multiple types of energy storage batteries, or a combination of energy storage, renewables and diesel backup, to ensure constant reliability and take advantage of constantly evolving pricing scenarios. Considering these new levels of complexity in the context of an ever-changing environment, microgrids need a command center—a system of advanced energy controls.

Fortunately, advancements in information technology—such as the Internet of Things—enable automated energy management that keeps up with multiple components and changing conditions. These systems can make decisions that optimize price, reliability and the use of clean energy, based on those parameters. This new wave of digital data technologies is key to making modern microgrids a sound investment.

Microgrids empower the end user with control over the energy mix, as well as freedom from the bureaucratic maze of a power utility. They create new cost-saving opportunities unavailable to those tied to the utility—particularly for island regions, where these systems are especially popular in part due to high fuel costs.

Case in point: The Cayman Islands. The sunshine is abundant, but diesel fuel costs are very high. Feeling the high price of imported fuel, the developer of the mixed-use Cayman Technology Centre — an EnSync Energy client — sought to tap into the falling price of solar and increase the number of solar arrays installed on the property, an office and retail complex in downtown Grand Cayman. The goal was to power the entire complex with solar but remain connected to the central utility’s grid as a backup.

Due to utility rules, the developer realized that he would have to disconnect from the main grid to install the high solar capacity — 400 kW — he desired. The developer initially deployed solar with a diesel generator as a backup but later realized there were potential untapped opportunities to reduce the cost of diesel even further. That’s where we came in to help with a customized solution. We added another booming clean technology with falling prices: energy storage. This addition saved significant costs but also added complexity to the system. A simple microgrid, such as one that consists of a few solar arrays and diesel generator, might be manageable by the operator, but more sophisticated management tools are crucial for today’s more advanced microgrids. Plus, a great deal is at stake when you’re fully “islanded” off the grid.

To manage these multiple elements and ensure both reliability and savings, we installed our energy management system and software, which automates coordination of distributed energy resources. These smart systems make full use of the Internet of Things, embedding energy sources with sensors and electronics that connect them to each other, to the microgrid and to a cloud-based repository of real-time data. The software then uses data to supervise the energy sources, continuously analyzing energy prices, demand and weather conditions to determine the right energy mix to meet the microgrid operator’s goals. For example, the software can be programmed to switch from solar to battery when market energy prices pass a certain threshold, such as $300 per MWh, or when it receives weather forecast data indicating an upcoming rainstorm.

In the Cayman Technology Centre microgrid, the energy management system and software know when to switch from solar to battery during the day and when to turn on the diesel generator when the battery power supply is low. It keeps the multiple energy components working in synchronization, ensuring reliability and freeing the developer to use the solar he desired. The result is automated management that makes use of data, in a way that simply cannot be done manually. Even the most ardent fans of electricity market dynamics cannot constantly monitor prices and adjust their microgrid settings accordingly. Automation becomes even more important considering the need for reliability and to avoid incidents like battery drainage.

Without advanced controls, the developer would not be able to calculate which arrangement of electrons—e.g., when to turn off the solar and turn on batteries, or when to turn both those off and start the diesel—will result in the highest value energy—certainly not in continuous real time. The resulting energy savings will help offset the cost of the microgrid installation.

With nearly 2,000 microgrids currently operating in the United States alone, the energy industry seems to be on a mission to go lean and green. Today’s technologies—as well as new energy challenges—have created new expectations for these decentralized systems. As they grow in number and complexity, microgrids in turn will need sophisticated digital automation and smart management to turn them into reliable alternatives to the conventional grid.

Lead image credit: CC0 Creative Commons | Pixabay

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Dan Nordloh is Executive Vice President of Global Business Development for EnSync Energy Systems. In his role he is responsible for the evolution and execution of EnSync’s global growth strategy, and serves on the Board of Directors of Anhui Meineng, EnSync’s joint venture company in China. Additionally, he leads initiatives to enter emerging markets and identify and align with prospective strategic partners.Prior to joining EnSync, Mr. Nordloh has held comprehensive leadership roles, primarily in IT and polymer technologies businesses, developing and executing rapid growth, turn-around and succession initiatives.

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