The Intricate Act of Optimizing Your Microgrid

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Bryan Knight, director of structured finance at PowerSecure, explains the challenges associated with creating an optimized microgrid and how to overcome them.

Microgrid 2020 Global

Bryan Knight, director of structured finance at PowerSecure

Microgrids should be like a set of fingerprints, with no two being exactly alike. There are simply too many variables at play for a one-size-fits-all approach.

Success is measured with respect to the achievement of certain predefined goals that build upon one another, in a stepwise fashion, towards a desired outcome. This process is most often perceived as a linear progression from start to finish, but when it comes to building the right microgrid, it is best to invert this process and start the journey at the end by asking the customer, “What is the outcome(s) you envision once your microgrid has finally been turned on?” With the final destination in mind, a more precise set of meaningful goals can be delineated, thereby increasing the likelihood of a successful journey regardless of any complexities that may arise.

Improved power reliability, reduced power cost, and a minimized carbon footprint are the most common outcomes customers hope to achieve. However, the priority assigned to each of these objectives tends to fluctuate from customer to customer, resulting in the first additional level of complexity when initiating the deployment process. In other words, there is no single, all-inclusive solution when it comes to microgrid deployment.

Creating an optimized microgrid is a balancing act

A second layer of complexity quickly becomes apparent when one also considers that different microgrid technologies each have their own unique advantages, limitations, and cost.  For example, reciprocating generators are excellent at providing long-term standby power and reducing demand charges relative to the amount of energy drawn during periods of grid stress. While these have typically relied on fossil fuels, renewable fuel options are beginning to appear on the market (and materially reduce emissions). Storage is best for reducing daily peak demand and compensating for the intermittency of renewables, but it is comparatively expensive and its overall cost scales relative to the duration of need (which is often unknown). Solar and other renewables excel at providing cost-effective energy over a long horizon but are also subject to intermittency. Optimization, therefore, is the process of assessing and balancing the strengths, weaknesses, and costs of multiple microgrid technologies, in order to deliver a custom-built solution that successfully realizes the customer’s vision for the best possible value.

Utility tariffs introduce a third layer of complexity. Tariffs determine the rules and rates that translate a customer’s electric consumption into a customer’s electric bill. In the United States alone, there are more than 3,000 different electric utility providers, and while a survey of all of their tariffs would find many common features and mechanisms, the reality is that no two sets of tariffs would be the same. As such, a group of customers may have similar or even identical combinations of objectives, yet the final optimized microgrid solution for each customer may vary based on the underlying properties of their respective utility tariffs.

The fourth and final layer of complexity is technical implementation, engineering, and controls. A good analogy for this layer is two parents, who have just had their second child, admitting that raising two children requires more than twice as much work as raising a single child. The process of integrating multiple microgrid technologies tends to complicate the engineering challenges in a way that closely resembles exponential growth. Two is a lot harder than one.  And three starts to require some special talent. This is because the number of configurable states the microgrid could be in goes up and the logic required to manage everything gets longer and more intricate. Experience and testing (and testing again) are invaluable to tools to help manage this challenge.

No wires crossed (figuratively and literally)

An enterprising energy or plant manager may elect to stick build a solution by delegating the various tasks of solving the unique challenges posed by microgrid optimization across a handful of service providers. For example, a plant manager may define the goals for the microgrid, apply in-house analysis or hire outside consultants to work backwards from the tariff to configure the necessary combination of technologies that best meets those goals, employ a team of engineers to design it, and finally hire a general contractor to build the final product. However, this approach contributes to its own form of complexity with regards to project management. Ensuring a figurative (or even literal) wire is not crossed, becomes a job unto itself.

Since its founding in 2000, PowerSecure has taken pride in providing our valued customers with innovative microgrid solutions that originate from a single point of accountability — PowerSecure. I never really understood the true meaning behind that, until I started working on projects over their entire life cycle, rather than just analyzing their economics. There are, of course, multiple ways to solve any given problem, but having a dedicated analytics team that works in the same hallway — and today, on the same virtual team — as the engineering team, seems to be a step above the rest. There is a certain organic beauty in the way that these two teams interact with one another, as they transition seamlessly from evaluating the tariff, to determining the right combination of technologies, and finally creating a one-line (and then doing it all over again and refining the output when something changes). Imagine how much more efficient and pleasant your microgrid journey will be when the final design can also be handed over to an operations team on the same team, and passed onto a construction crew already intimately familiar with the microgrid technologies and switchgear— with many of those developed in the same building, too. And when the time finally comes to operate the microgrid, it helps if the team monitoring and remotely dispatching it has a detailed plan (provided by the same in-house analytics department), which explains the economically optimal strategy for how and when the microgrid should be best utilized. 

Summary

The process for creating an optimized microgrid that specifically addresses your unique power needs poses an intricate challenge, but it does not necessarily have to be a daunting undertaking. Solutions providers like PowerSecure have shown that a vertically integrated, 360 approach to microgrid delivery, beginning with custom design and ending with operation and dispatch, is an effective way to navigate all the inherent complexities to deliver a precise solution that satisfies any set of needs.

Bryan Knight is an executive at PowerSecure.

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Comments

  1. I note, with technical disdain, that you limit your definition of grid power to wind, solar and batteries. We all now that none of these methods are viable without massive subsidies, which the industry admits they need to make these technologies viable while claiming that they are cost-effective. If your engineering firm wants to compete in the future of microgrids, you should consider the small modular nuclear reactor as part of the mix. The complications you describe of “multiple teams” working together to integrate a custom solution disappears when you consider a compact, safe, base-load power source that will not need storage. I keep getting your emails, so I simply have to comment on a solution that costs so much it takes massive Government subsidies with no end in sight, but claims that the solution of “cost-effective”. We pay for it one way or another, but it does not give me confidence in a solution predicated on constant Government funding, which I end up paying for in addition to the energy. Microgrids are needed and could be the solution to a fragile national grid system, but we have to be smart on how we engineer a solution for customers who want a competitive price for their energy supply.

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