Credit: USDA
Baltimore Gas & Electric (BGE) has launched a plan to build public purpose microgrids across central Maryland, starting in Howard County and Baltimore.
The Exelon subsidiary proposed the microgrids late last week in a filing before the Maryland Public Service Commission. The first two microgrids will supply 2-3 MW and are expected to cost $3.5 million per MW.
If the pilot microgrids are successful, BGE says it intends to follow up with at least one public purpose microgrid in each county within its service territory.
The largest utility in Maryland, BGE spans a 2,300-mile area that includes 10 counties. It has 1.25 million electric customers and more than 650,000 natural gas customers.
Rob Biagiotti, BGE vice president and chief customer officer, said that the utility will use the pilot to better understand how microgrids can enhance the electric grid.
“Microgrids are designed to strengthen the reliability and resiliency of the electric grid and provide geographic locations that can maintain power and provide vital community services to our customers when a region in our service territory experiences widespread outages,” he said.
BGE’s announcement adds to the growing microgrid activity among utility subsidiaries of Chicago-based Exelon, a $24 billion energy company. In Pennsylvania, PECO Energy plans to undertake a $50 to $100 million microgrid pilot program. And in Illinois, Commonwealth Edison has six microgrids on the drawing board, including a 17-MW airport microgrid.
The BGE microgrids are the result of a 2014 state task force report calling for utilities to build public purpose microgrids to avert outages in a crisis. The task force warned that the number of named Atlantic storms has increased 67 percent since 1995, with annual associated costs between $20 billion to $50 billion.
Maryland defines public purpose microgrids as those that serve critical services and multiple customers and properties, likely community centers, commercial hubs, and emergency service complexes. They are similar to what other states call community microgrids.
First Public Purpose Microgrids
One of the first projects will be a 3-MW microgrid in Edmondson Village, which includes the west side of Baltimore City and the nearby Uplands development. The project is expected to cost $9.2 million, according to BGE’s filing with the PSC.
About 676,000 residents would be within five miles of the microgrid, as well as a library and high school that could serve as shelters. The area also has a major grocery store and pharmacy, gas station, six restaurants, two general stores, medical and dental offices and an auto parts store.
The second pilot, a 2-MW microgrid at Kings Contrivance Village Center in south-central Howard County, would cost an estimated $7 million to build. About 217,000 residents are within five miles of the site. A grocery store and pharmacy also are nearby, along with banks, a gas station, several restaurants, personal service stores (barber, dry cleaners), insurance offices and other small businesses.
BGE chose the first two sites for several reasons, including their mix of services, urban and suburban locations, nearness to public transportation or major roadways and other factors.
The pilot microgrids will use natural gas. In fact, BGE says natural gas will be its preferred fuel source for microgrids. If natural gas is not available, the utility will use diesel fuel.
Customer-owned renewable energy also will be included within the public purpose microgrids. This approach offers the added bonus of keeping the lights on for customers with solar panels when the grid goes down, said BGE in its state filing. Without a microgrid, solar customers lose their power during outages, unless they have on-site energy storage.
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The pilot microgrids will not include energy storage because of its current cost and the difficulty interconnecting and controlling the resource, BGE said. The utility will reconsider this decision for future microgrids if “costs decline and technical issues are resolved.”
Paying for the Microgrids
BGE is seeking PSC approval to pay for the microgrids through a monthly charge on customer bills. The average residential customer would pay about $0.04 per month in the first year. This would cover an initial $1 million in microgrid costs, according to the filing.
Source: BGE public purpose microgrid proposal filed Dec. 18, 2015 before the Maryland PSC. Scroll below for more details on pricing.
The utility would adjust the charge annually. It will include cost recovery for depreciation and amortization, fuel, operation and maintenance and earnings on the net investment and taxes.
The microgrids can offset at least some of their costs through sales to PJM’s wholesale energy, capacity and ancillary services markets. The microgrids also will participate in demand response programs – another source of revenue.
The utility says that based on historical figures, a microgrid with 2 MW of firm capacity could earn $10,000 per month, as well as value from dispatching when locational marginal pricing is high on the grid.
Work on Grid
The layout of each microgrid will depend on BGE infrastructure at the sites. The utility plans to use existing feeders and equipment as much as possible as the main backbone of the microgrid. Where necessary, it will replace underground cable and overhead wire.
BGE sees switching as the most complicated aspect of the microgrid projects, and is considering automated versus manually operated switchgear. Automated switch gear would restore service more quickly, but may be more expensive.
BGE also plans to use a centralized automation control system to monitor and control the microgrid. The BGE control room, however, will be able to override the system.
The utility asked the PSC to take up the microgrid proposal at its Jan. 27, 2016 administrative meeting. Design and construction of the microgrids is expected to take 12 to 18 months.
