The growth of renewables and other energy technology is not just changing the way consumers get their power. The trend toward nontraditional fuel sources also is contributing inadvertently to the growth of other, previously ancillary systems that are riding the wave of green technology. In some cases, they have become indispensable to it.
Microgrids, for example, were once the domain of military bases, universities and other isolated locales. A variety of factors is contributing to a transformation of microgrids into essential tools of grid modernization.
That is the conclusion of a recent study released by GTM Research, a division of Greentech Media. The July study, “North American Microgrids 2015: Advancing Beyond Local Energy Optimization,” examines a number of changes underway. The conclusions point to rapidly evolving technology and an equally rapid market expansion.
For example, according to GTM, various state-level resiliency programs are encouraging development and standardization of microgrid technologies. Regulatory and legislative changes to utility franchise rights and rate structures are also creating a more favorable market for microgrids. Finally, microgrids are benefitting from the growth of renewables. In particular, they are becoming an essential tool for integrating the exploding capacity of solar power.
The convergence of these trends has helped transform microgrids into a grid-modernization tool for utilities, cities, communities and public institutions. While the market is growing, the technology is also evolving. According to GTM, this new wave of microgrids is cleaner, more flexible and increasingly complex, with the potential to dramatically alter the power landscape in the United States.
The report projects the microgrid market to more than double in the next five years, both in terms of installed capacity and annual value. Total microgrid capacity in the United States is expected to exceed 2.8 gigawatts (GW) by 2020, rising 127 percent from 1.3 GW at the end of this year. The annual market value is expected to grow 267 percent during that period, to more than $829 million annually.