Utilities Begin To See The Value of Adopting Microgrids

Utility ComEd has received US$1.2 million to develop a cluster of microgrids.
Published: Wed 24 Sep 2014

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The US Department of Energy (DOE) has awarded Common Wealth Edison Co (ComEd) with a US$1.2 million grant to build a master controller that could drive the operation of microgrid clusters.

ComEd assembled a group of science and technology partners for the DOE proposal including Alstom Grid, Argonne National Laboratory, Illinois Institute of Technology, Microsoft, OSIsoft, Quanta Technologies, S&C Electric, Schneider Electric and University of Denver. In collaboration with this group of science and technology partners, the utility is taking a lead role in positioning interconnected microgrids as viable energy systems that help address ongoing challenges of national energy security, sustainability, and resiliency, as well as positioning Chicago as a hub for energy sustainability and independence.

Master controller - the brain of the microgrid

"Creating a master controller is a critical step in unleashing the value and potential of microgrids," says Joe Svachula, vice president, Engineering and Smart Grid, ComEd. "While working with our technology partners to develop a first-of-its-kind microgrid controller that could work in a single or clustered environment, ComEd also will gain essential insights into the foundational building blocks for deploying a robust microgrid."

The master controller is considered to be the brain of the microgrid, as it collects data from a variety of individual energy resources, centrally determines how to control and operate those energy resources (i.e., generators, energy storage, adjustable loads, smart switches, etc.) and sends out the control signals that ultimately carry out the power activity.

Microgrids -- localized power systems with the ability to self-supply and operate independently of, or in concert with, the main grid to meet the energy needs of multiple entities -- can take power generation from the central power grid, as well as from sustainable sources including solar and wind should disruptions occur on the main grid.

Some communities were able to maintain power during and after the severe and devastating weather impacts of Hurricane Sandy, thanks to microgrids.

ComEd's community-based microgrid has the potential to provide benefits to Chicago through improved reliability and enhanced resiliency in response to weather related events like these.

Utilities embrace microgrids

Although microgrids are becoming more and more mainstream, utilities are generally not the ones on the cutting edge of this innovation.

Electric utilities’ approaches to integrating distributed energy resources using microgrids vary widely. The utility distribution microgrid is viewed with a somewhat skeptical eye and some utilities view it as an existential threat to their traditional business models, according to Navigant Research in its report, Utility Distribution Microgrids.

However, there are a few utility innovators that are taking on microgrid projects despite significant institutional bias and regulatory obstacles, leveraging a wide range of smart grid technologies and utilizing new architectures to pursue creative solutions for the integration of renewable energy, the improvement of grid reliability, and the reduction of peak load.

These early adopters, such as ComEd, are heralding a future in which microgrids will become a more prevalent part of the distribution utility landscape.

"There is no doubt that microgrids will be core components of the future integrated grids and extensive research and development efforts will be undertaken in upcoming years," said Amin Khodaei, Ph.D., assistant professor for the Department of Electrical and Computer Engineering, Ritchie School of Engineering and Computer Science, University of Denver. "The truly remarkable and distinguishing feature of this project is that it is initiated and will be led by a utility company."

“S&C is delighted to be working with one of the most forward thinking utilities in the country on this microgrid project,” says David Chiesa, director, Microgrid Business Development, S&C Electric Company. “This project shows how utilities are not only embracing microgrids, but leading the way in their wide scale adoption.”

Microgrids are business opportunities for utilities

Instead of viewing microgrids as new competitors to traditional electricity distribution utilities, these local networks of distributed generators, smart electricity loads, and energy storage devices should be seen as a new business opportunity by utilities.

A brilliant example of this is New York state utility Central Hudson Gas and Electric Corporation which offers microgrids as a new service for electricity customers who want a more reliable source of power [Engerati-Are Microgrids The Route To The Utility Of The Future?].

A single large customer or an aggregation of many smaller customers with a total demand of 500kW or more can sign a service contract with the utility, which would build, own, maintain, and operate a custom-designed microgrid for these customers.

Microgrids would offer two main benefits:

  1. Assurance that energy supplies will be provided to sites deemed critical for public services or safety even during wide-scale outages or natural disasters

  2. Enhanced reliability and resilience for high-priority sites where outages can cause serious disruptions, risks, or financial losses.

Prime candidates for microgrids include hospitals, military bases, police and fire services, and other key government facilities, as well as university campuses, schools, and large commercial or industrial facilities that require uninterrupted power supplies. Costs for the microgrid would be recovered from participating customers through the service contract and would not affect other utility customers or rates.

Utility-owned and operated microgrids would compete with other installers of distributed generation, uninterruptable power supplies, and energy storage devices. A utility’s expertise in designing, building, and operating electricity networks will give utilities an advantage. Customers who want improved reliability could benefit from a cheaper alternative to buying their own batteries or backup generators.