The Microgrid Market Has Arrived and Here’s What’s Next: S&C Electric

When Microgrid Knowledge interviewed Mike Edmonds, the president of US Business at S&C Electric, a year ago at Smart Cities Week in Washington, D.C., he described the microgrid market as still emerging.

microgrid market

Mike Edmonds, President US Business, S&C Electric Company

This year at the same conference, Edmonds had a different take. With S&C’s contracts up 100 percent, Edmonds said, “There is clearly a market.”

The Chicago-based company, which specializes in electric reliability, is strongly positioned to make such judgments. S&C arrived early to microgrids and has been carefully watching — and helping to shape — the emergence of the microgrid market for five years.

“From 2012 to 2014, we had some internal discussion at S&C over ‘Is the market going to occur?’ I was personally of the view that it was going to occur. It was just a matter of when,” he said.

In the early years, the company found itself explaining the need for microgrids to utilities – which make up 70 percent of its customer base – and more recently to their unregulated affiliates that sense new opportunity.

Today, the conversation is shifting. Now it’s less about explaining microgrids to utilities, and more about helping utilities explain microgrids to state regulators.

“How do we help our customers, the utilities, explain their need to have microgrids?” Edmonds said.

It’s a daunting task not only because it’s a 50-state conversation, but also because utilities find themselves in the difficult position of trying to justify cost recovery from all customers for microgrids that seemingly benefit only a few.

Lost in the discussions is the fact that not all customers are the same.

“It’s okay to have a hospital with the same [electric] service as residential. Huh?” he said. “There is nothing wrong with having better reliability for an airport, the hospital or pumping station.”

So how does the microgrid industry get this message across?

“It is going to come down to how do we explain the value of a reliable grid,” he said. “We have to strip it back to the fundamentals. If you don’t have a reliable grid there are implications to safety health, jobs, employment…a whole range of issues to the economy.”

Reliability as microgrid market driver

The reliability message comes readily to S&C, and it fits squarely into its product line of distributed intelligence, offered since 1996. In fact, today S&C is positioning itself less as a maker of widgets and more as a company that delivers electric reliability, he said.

Edmonds sees the reliability message gaining importance as consumers increasingly both consume and produce energy. Prosumers will expect the grid to live up to its end of the bargain.

“As consumers have more and more power sources on their houses behind the meters – solar, batteries, whatever they’ve got – when the grid is not there they are going to be more annoyed,” he said. “We are seeing a revolution in the consumer base. The prosumers are becoming more engaged. At some point those prosumers are not going to tolerate outages.”

To better understand what this future holds, S&C is adding 50 engineers to work on innovation. It also has network consulting groups studying grids to unearth potential customer problems, figure out how to fix them and determine where energy storage and microgrids will help.

The ultimate goal is to ensure stable grid operations. “We are specialists in protections and controls,” he said.

Taking the long view

Given the essential nature of the grid, even as microgrids rise, utilities will not fall, in Edmonds’ view.

“I never subscribed to the death of the utility,” he said.

To maintain a medium to high voltage system, “you need to have a qualified work force, able and equipped to build, repair and maintain what is basically a very dangerous system. The utility has a role and will continue to have a role. I just hope the regulators allow the utilities to address the changing marketplace,” he said.

If it takes some time, expect S&C to stick it out. Founded in 1911, the employee-owned company takes the long view, calculating markets in 30-year cycles.

“We have patience over the market forming. We are not fly-by-night. We’re not going to come and go, saying that’s not working for us, we haven’t got our quarterly numbers,” he said.

So, for S&C it’s another year, more change and innovation, new challenges and a bet on the microgrid market that is starting to pay off.

The #microgrid market has arrived -- Mike Edmonds, S&C ElectricClick To Tweet

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Elisa Wood About Elisa Wood

Elisa Wood is the chief editor of MicrogridKnowledge.com and EnergyEfficiencyMarkets.com. She has been writing about energy for more than two decades for top industry publications. Her work also has been picked up by CNN, the New York Times, Reuters, the Wall Street Journal Online and the Washington Post.

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