What You Need to Know about Solar, Storage, and Microgrids
REC Solar recently participated in a webinar on Renewable Energy World that invited several experts to discuss the U.S. landscape for solar PV with microgrids, and energy storage for business.
The panelists included:
Peter H. Asmus, Principal Research Analyst at Navigant Research. Peter is a leading global expert on microgrids and virtual power plants and the author of four books on energy and environmental issues.
Ben Peters, who serves as Director of Solar Finance & Policy at REC Solar. Ben provides strategic guidance on the commercial and utility sector, and he also manages REC’s economic analysis group, which helps REC customers to develop projects based on relevant regulatory and policy changes.
John Wood, Chief Executive Officer of Ecoult, an energy storage solution company. John first joined the energy storage community in 2008, having previously launched technologies globally in security, identity, payment technology, and telecommunications.
The Growing Demand for Solar Microgrids
Peter Asmus began the webinar with a brief description of solar power microgrids and their advantages, including the ability to “island” (produce energy independently of the grid) during any kind of blackout or natural disaster. They’re also an economic advantage over fossil fuel-based generators in isolated areas, such as Hawaii and Puerto Rico, where most fuel for the grid is imported.
Peter also touched on the fact that energy markets and policies are rapidly changing and moving favorably toward renewable energy. States are implementing mandates and incentives that make solar energy competitive with fossil fuels. In some states like California, solar is already at grid parity without incentives, and storage costs are also rapidly declining.
The U.S. military is also noting the potential benefits of microgrids, both in the field, as well as adding to the security of a base’s infrastructure in case of attack or a natural disaster.
Another reason why the U.S. is getting more interested is climate change. The grid is getting less reliable thanks to the increasing number of super storms and extreme weather, both hot and cold. Peter’s graph on slide 10 shows how the number of power outages are increasing throughout the U.S.
Of course, there are also challenges to solar micrgrid growth, and Peter mentioned several. For one, utilities are putting up obstacles to these types of complex grid integrations, not understanding their technology and questioning their benefit to the larger grid—as well as to their bottom line.
Given all of the above, Navigant is now forecasting a conservative estimate of 4000 MW of installed microgrids by 2020 in North America, and may be as high as nearly 8000 MW. Asia and the East may install even more, and Europe is also strong.
The U.S. Market for Solar Market Grids: Venues, Regulations, and Business Models
REC’s Ben Peters was next on the panel and began by highlighting all of the potential venues of microgrids, such as off grid applications for villages and island nations, as well as systems that might be integrated with military bases, universities, and research centers.
Ben then moved on to discussing the ideal physical and economic environment for an interconnected solar microgrid. With certain state incentives, many businesses and landowners might benefit from installing a microgrid to simply profit from providing solar electricity and grid storage directly to their local utility. This is known as a “front of the meter” business model scenario.
In the “behind the meter” scenario, the solar microgrid would be installed on site and feed solar electricity to the actual business or institution, thus reducing its energy costs and utility demand charges while also providing some backup power in case of a grid outage.
Beyond your potential business model, Ben talked about the physical and financing challenges of implemention. Typically, microgrids are financed, so an institution needs to be approved by a lender or financier experienced with these types of energy infrastructure projects. Moreover, engineers have to be able to physically interconnect the project with the overall grid, and in some cases, that may not be possible due to the need for expensive grid upgrades.
In terms of markets, Ben displayed a map of the different solar microgrid markets that exist in the U.S. today. The map reveals that most projects are being installed in areas of California, Arizona, New Mexico, Texas, Florida, North Carolina, Michigan, and New Jersey. Other states, especially in the Midwest, are installing them too, but these are smaller projects and fewer in number.
Solar with Storage and Microgrids and Their Applications
The last speaker, John Wood, focused his presentation on the storage component of solar microgrids. John really dives into the details of solar storage applications and the advantages of energy storage today when combined with renewables and fuel-based microgrids, especially for islanding.
In particular, John highlights storage as a solution for grid variability, especially for wind smoothing and solar shifting, which help balance the grid from these renewable energy sources that can fluctuate and surge by the minute.
He also discusses how battery storage can be added to existing diesel microgrids to increase efficiency, reduce the fuel costs, and of course reduce emissions.
Finally, John outlines the technology and advantages of his Ecoult UltraBattery lead acid-based battery solution, which combines diesel generation with renewables and battery storage. John discusses how this hybrid energy combination can be a cost-effective, efficient, and reliable solution for existing fossil fuel-based microgrids.
Those are the highlights of our webinar. You can see the entire webinar, as well as the post-webinar Q&A that dives deeper into costs, on RenewableEnergyWorld.com. (Click “Register” fill out the form, and the webinar will be replayed.)
Of course, if you have any questions about this presentation or about solar economics for your facility’s operations, please contact us.