Rising energy cost, aging infrastructure, mass electrification, and climate change are some of the common problems faced by the power industry. Increasingly, microgrids are being implemented to solve some of these problems.
Microgrids are localized grids that can disconnect from the traditional grid to operate autonomously. Because they are able to operate while the main grid is down, microgrids can strengthen grid resilience and help mitigate grid disturbances as well as function as a grid resource for faster system response and recovery.
In most countries, traditional power grids are aging.
For instance, the North American power grid is vulnerable due to its aging grid infrastructure. It is estimated that more than 65% of transmission lines and transformers are at least 25 years old, and more than 50% of circuit breakers are about 30 years old. While the power utilities in Asia suffer from low electrification rate, 765 million people still lack access to reliable grid electricity in the region. The traditional grid is hierarchical in nature, where power is generated from a central location, which is then sent through the transmission system to the substation and distribution lines, and finally to end-users. During this process, about 8% power is lost in transmission and distribution. Therefore, the need to overcome the challenges faced by a traditional grid and introduce a new level of sophistication in its functioning, in a highly controlled environment, has driven the need for microgrids.
Rise in natural calamities
Natural calamities, such as earthquakes, storms, hurricanes, and tornados, damage the transmission and distribution infrastructure, clearly revealing the vulnerabilities of utility grids. Natural calamities, whether big or small, result in grid failure, leading to power cuts in the residences of millions of people as well as commercial and industrial sectors. Such power outages can extend from a few days to weeks.
In 2012, when the US was hit by Hurricane Sandy, millions of people and several medical centers and other critical infrastructure facilities were left without power. In the midst of the outage, 15 MW combined heat and power (CHP) generator and 5.3 MW solar microgrid installed on Princeton University in New Jersey were able to power the university campus for three days.