A Growing Business Case for Microgrids August 2019
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As part of an ongoing upgrade and modernization of the second-busiest US port, Schneider Electric recently designed and built an innovative microgrid project at the Port of Long Beach (POLB) in Southern California with the following features:
- Two separate battery-storage systems: a 250-kilowatt (kW) mobile battery in a large container on a chassis and a 330 kW/670-kilowatt-hour stationary battery
- A 300 kW solar-power array (carport) and an existing 500 kW diesel generator
- Schneider's preconfigured hardware solution and EcoStruxure microgrid and power solutions, which provide an energy-management platform for distributed resource integration, data collection, and optimization, along with remote power monitoring and control capabilities
- Microgrid controls for demand response, peak shaving, and islanding (isolation from the grid).
The two battery systems connect to the whole power system and allow for a range of connections in case of grid outages—for example, to refrigerated container ships, a sewer pump station, or a community emergency shelter. The microgrid's modular and flexible design allows for software control with virtual-wires connections and pretested configurations. In normal operations, the batteries enable peak shaving and greater participation in utility-demand response programs, which can reduce utility-demand charges significantly.
Electricity increasingly powers commercial and industrial equipment, and a growing number of US airports, shipping ports, and other transit centers—as well as other large commercial customers such as hospitals, campuses, and military bases—are deploying microgrids to improve electricity reliability and enable energy self-sufficiency during power outages. The US grid, in particular, is a patchwork of decades-old systems that is generally less reliable than Europe's grid. More extreme weather events are also resulting in more frequent grid outages in many regions. Following major wildfires in California, for example, utilities are expanding policies to shut down portions of the grid during risky conditions.
Advanced control platforms, modular and easy-to-install systems, and new business models are helping microgrid markets to expand. Energy-as-a-service models from players—including Schneider Electric and Siemens—allow a third party to finance the up-front cost for a microgrid. The customer gains reliability and other benefits and pays for its energy use only, without the complexity of owning and operating a microgrid. The drive toward zero-carbon-emission operations is also supporting microgrid adoptions. The California Energy Commission funded $5 million of the $7.2 million POLB microgrid cost as part of a program to accelerate commercialization of microgrids with high shares of clean distributed-energy technologies.
Microgrids represent a high-growth market for energy-storage technologies, especially batteries. Navigant expects global microgrid capacity to jump from 3.2 gigawatts in 2019 to 15.8 gigawatts in 2027. Microgrids support the current trend to upgrade and digitalize power infrastructures and play a growing role in providing low-carbon, stable electricity supplies and value-added services from distributed renewables. In developing countries, microgrids are a major pathway to electrification that can reduce dependence on expensive diesel fuel in remote areas.