Distributed generation microgrid market to reach $13 billion by 2018

Whether tied to the larger utility grid or islanded from it, microgrids are becoming an increasingly common way for campuses, communities and other large power users to harness the benefits of distributed power generation.

Many of these systems are deployed by end-use customers who are not getting the quality of energy services they desire from their host distribution utilities.

According to a recent report from Pike Research, a part of Navigant’s Energy Practice, annual revenues from distributed generation microgrids will reach $12.7 billion in 2018.

“Microgrids represent a fundamental building block of the ultimate smart grid, designed to serve the needs of energy producers, consumers, and distribution utilities,” says senior research analyst Peter Asmus. “Perhaps most importantly, microgrids are an important accelerator for various kinds of distributed power generation, particularly from renewable sources.”

Some of the technologies that will enable the growth of microgrids in coming years, such as system controllers, are still immature, while others, such as solar photovoltaics, are already global markets in their own right. The foundation of any microgrid is distributed generation (such as solar PV or small wind power), but nearly as critical are smart, bi-directional islanding inverters that enable microgrids to operate in standalone mode, disconnected from the wider grid.

Over the course of the next several years, the islanding function of inverters for renewable distributed energy generation, combined heat and power (CHP), fuel cells, and energy storage will become much more prevalent, according to the report.

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