1. Local.
Local - First, this is a form of local energy, meaning it creates energy for nearby customers. This distinguishes microgrids from the kind of large centralized grids that have provided most of our electricity for the last century. Central grids push electricity from power plants over long distances via transmission and distribution lines.
Delivering power from afar is inefficient because some of the electricity – as much as eight to fifteen percent – dissipates in transit. A microgrid overcomes this inefficiency by generating power close to those it serves; the generators are near or within the building, or in the case of solar panels, on the roof.
2. Independent.
A microgrid can disconnect from the central grid and operate independently. This islanding capability allows them to supply power to their customers when a storm or other calamity causes an outage on the power grid. In the U.S., the central grid is especially prone to outages because of its sheer size and interconnectedness – more than 5.7 million miles of transmission and distribution lines.
As we learned painfully during what’s known as the Northeast Blackout of 2003, a single tree falling on a power line can knock out power in several states, even across international boundaries into Canada. By islanding, a microgrid escapes such cascading grid failures.
While microgrids can run independently, most of the time they do not (unless they are located in a remote area where there is no central grid or an unreliable one). Instead, microgrids typically remain connected to the central grid. As long as the central grid is operating normally, the two function in a kind of symbiotic relationship, as explained below.
3. Intelligent.
A microgrid – especially advanced systems – are intelligent. This intelligence emanates from what’s known as the microgrid controller, the central brain of the system, which manages the generators, batteries and nearby building energy systems with a high degree of sophistication.
The controller orchestrates multiple resources to meet the energy goals established by the microgrid’s customers. They may be trying to achieve lowest prices, cleanest energy, greatest electric reliability or some other outcome.
The controller achieves these goals by increasing or decreasing use of any of the microgrid’s resources – or combinations of those resources – much as a conductor would call upon various musicians to heighten, lower or stop playing their instruments for maximum effect.
A software-based system, the controller can manage energy supply in many different ways. But here’s one example. An advanced controller can track real-time changes in the power prices on the central grid. (Wholesale electricity prices fluctuate constantly based on electricity supply and demand.)
If energy prices are inexpensive at any point, it may choose to buy power from the central grid to serve its customers, rather than use energy from, say, its own solar panels. The microgrid’s solar panels will instead charge its battery systems. Later in the day, when grid power becomes expensive, the microgrid may discharge its batteries rather than use grid power.