Microgrids should be viewed as complementary and a building block to the centralised grid.
Microgrids are emerging as a key technology for remote and island electrification towards the achievement of the goal of sustainable energy for all, which aims to bring electrification to the approximately 1.1bn people without by 2030.
The International Energy Agency (IEA) has estimated that as much as 60% of future electrification of rural households could take place through microgrids and other stand-alone systems – and the majority of this from microgrids – with the balance through grid extension. Advantages are the lower costs and the speed of matters of weeks or months with which these decentralised systems can be deployed.
However, in many cases at some future data, ongoing centralised grid extension will result in crossing paths with the microgrids. And this eventuality needs to be considered from the outset in the planning stages, according to a new discussion paper from ISGAN (International Smart Grid Action Network), ‘The role and interaction of microgrids and centralised grids in developing modern power systems – A case review’.
The paper reviews five country case studies from Malaysia, South Africa, Uganda, Canada and India.
Based on these, the paper presents best practice to guide preparations for the development of microgrids and their connection to the centralised grid. This is also applicable to the development of microgrids to support renewable energy integration and the provision of ancillary services, such as increased resilience, demand side management and facilitation of trading.
The premise is that the centralised grid and microgrids are complementary rather than competing technologies, with the microgrid a building block in creating an electric grid that is ‘smart’.
Each microgrid design differs with respect to the capacity, potential need of energy storage, type of production, level of grid intelligence, communication possibilities, etc.
Building a strong relationship with the customer, as well as understanding the customer requirements in a specific area, should be a focus when designing the microgrid. A further important criterion is that of ensuring a sustainable revenue model to support investment funding as well as the operation and maintenance of such projects.
For the design of a microgrid that does not have a connection to the central grid, consideration should be given to the likelihood of a potential grid connection becoming a reality. Such planning enables evaluation of the potential increase in energy demand when specifying the electrical requirements of the equipment (cable ratings, etc.).
The possibility of the provision of ancillary services to the centralised grid should also be kept in mind in aspects such as the design of the communication system.
When evaluating the best option for the electrification of a rural area, distance alone is not the only criterion to determine if it is feasible to build a microgrid. Factors such as poor development of infrastructure, challenging terrestrial conditions, low density of rural population and low income levels of communities also play an important role.
In countries with a limited number of isolated communities, a case-to-case evaluation is beneficial. However, in countries where this approach would be too costly or time consuming, simplified methods with the other factors should be used, according to the paper.
Governments that provide clear regulation and cooperate with private companies to increase the number of connected customers, using both decentralised electrification and grid extension, can be instrumental in ensuring that optimal solutions to electrification requirements are reached.
When the centralised grid expands into the area of the microgrid, it should be able to directly connect to the microgrid, with the microgrid operating as a cell to the centralised grid. To achieve this objective, and to avoid the risk of microgrid stranded assets, the microgrid equipment needs to comply with the technical requirements of the centralised grid.
These technical requirements should be evaluated in detail for each case and the consequences of the interaction between the microgrid and the centralized grid should be analysed.
The roles of the microgrid owner, the central network operator, governmental actors and local stakeholders should be investigated to ensure the determination of interaction mechanisms and parameters.
In general, all the involved stakeholders should agree on the specifications, i.e. the utilities, funding parties, engineering and construction teams, and the operations and maintenance team
Effective policies and regulations are also important to lower the risk of the deployment of poorly managed microgrids, the paper comments.